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Home My WebLink About20072760 ► � Memorandum Date: August 13, 2007 C To: Board of County Commissioners From: Monica Daniels-Mika COLORADO Subject: Resource Colorado—Water and Sanitation Metropolitan District Staff reviewed the August 1 , 2007 documents for Resource Colorado Water and Sanitation Metropolitan District. There are three components for our review, Capital Improvement Progress Report, District Financial Reporting, and Operations Reporting. Staff also reviewed this report for consistency and compliance with Section 214-20 of the Weld County Code. Staff recommends acknowledgement of receipt of the report. Our comments are as follows: Capital Improvements Progress Report: 1 . The Summary of Description and Drawing of Improvements proposed to be constructed within 36 months of January of the year of the Report (CIP Plan) are not attached. Because the District has not constructed any infrastructure this information is not yet available for review. District Financial Reporting: 2. July 2007, Mason Russell West conducted an independent audit and found the District declined to present a Management Discussion and Analysis for the year ending December 31, 2006. They determined that presentation of these items is not required as part of a basic financial statement, but is supplementary information required by the Governmental Accounting Standards Board. No additional concerns were raised. Operations Reporting: 3. Exhibit D Current Rules and Regulations are not included in this report and should be forwarded for further review. 2007-2760 (,3Ynin.L�ica �:Txq l'-27-0.007 SDo,aa Weld County Code Section 2-14-20 Service Plan: 4. As submitted, Resource Colorado Sanitation and Metropolitan District report adheres to the Weld County Code. 2007/memo/resourcecolorado2007 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT 141 Union Boulevard, Suite 150 Lakewood, Colorado 80228-1898 Tel: (303) 987-0835 Fax: (303) 987-2032 August 1, 2007 Mr. Don Warden Clerk to the Board of County Commissioners 915 Tenth Street; P.O. Box 758 Greeley, CO 80632 Re : Resource Colorado Water and Sanitation Metropolitan District Dear Mr. Warden: Enclosed please find an executed copy of the 2006 Annual Report To Southern Weld Advisory Board regarding the above- captioned District . Feel free to contact me with any questions or concerns . Sincerely, MlittincH \-4 Marina Wilson Assistant to Lisa A. Johnson District Manager Enclosure cc (with enclosures) : Southern Weld County Advisory Board Board of Directors-Resource Colorado Jason Carroll McGeady Sisneros, P. C. -Sharon Pellowe /17,,,, .,te,2?t ,to 4-a�-a)Q RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT 141 Union Boulevard, Suite 150 Lakewood, Colorado 80228-1898 Tel: 303-987-0835 • 800-741-3254 Fax: 303-987-2032 August 9, 2007 Mr. Don Warden Clerk to the Board of County Commissioners 915 Tenth Street; P.O. Box 758 Greeley, CO 80632 Re: Resource Colorado Water and Sanitation Metropolitan District Dear Mr. Warden: Enclosed please find a copy of the Intergovernmental Agreement (7/11/07) ; sets for the obligations of the Town and the District with regard to the funding of a feasibility study regarding the joint use of the Keenesburg facility to provide service to Pioneer Regional Metropolitan District and Pioneer Metropolitan District Nos . 1-6 to serve Pioneer Communities Phase I . This document should be added to Exhibit E to the 2006 Annual Report To Southern Weld Advisory Board. If you have any questions, please contact me . Sincerely, Marina Wilson Assistant to Lisa A. Johnson District Manager Enclosure Intergovernmental Agreement r-- This Agreement is entered into this .�day of J14.4.--C.— , 2007 between the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise, (collectively referred to as "Town") and RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado and its water and wastewater Enterprise and District, ("District"), who may be referred to individually as a"party" and collectively as the"parties." RECITALS WHEREAS, the parties previously entered into an agreement pertaining to Keenesburg's purchase of the water right associated with Well Permit No. 31652-FP located in the Lost Creek Designated Ground Water Basin, and other interests associated with said water right; and WHEREAS, Keenesburg has constructed a pipeline from the well associated with Well Permit No. 31652-FP to the point of delivery required by Keenesburg; and WHEREAS,Keenesburg is evaluating options for water supplies and wastewater treatment for Keenesburg and prospective development within Keenesburg; and WHEREAS, the District is providing the water supplies and wastewater treatment for the development of the Pioneer Communities located north and west of Keenesburg; and WHEREAS, Keenesburg has requested that Keenesburg and the District review and evaluate the respective water supplies and wastewater treatment options for each entity to determine if there are operations,projects or opportunities for the parties that will reduce costs for their respective customers and provide more efficient utilization of the resources required to provide service to their respective customers. NOW, THEREFORE, in consideration of the mutual promises and agreements made herein,the receipt and value of which are expressly acknowledged, the parties hereby agree to the following terms and conditions: 1. Review and Investigations. During the time period consisting of sixty (60) days from the Effective Date of this Agreement,the parties agree that the District, at its expense, will review and investigate the respective water supplies and wastewater treatment options for each entity and determine if there are operations, projects or opportunities for the parties that will reduce costs for their respective customers and provide more efficient utilization of the resources required to provide service to their respective customers. The review and investigations shall include, but not be limited to, the following: 1 A. Review and evaluation of existing and proposed water supply pipelines; B. Review and evaluation of existing and proposed water treatment facilities and operations; C. Review and evaluation of existing and proposed water storage facilities; D. Review and evaluation of existing and proposed wastewater treatment facilities and operations; E. Review and evaluation of financing options associated with water supply and wastewater treatment options. 2. Further Agreements. It is not contemplated by the parties that the review and investigations to be completed pursuant to this Agreement will result in written reports or analyses containing all of the results of the review and investigations. However, it is contemplated by the parties that the review and investigations may lead to further agreements between the parties that would implement cost savings and more efficient operations of the respective parties. In order to explore the opportunity for further agreements,representatives of each party shall meet from time-to-time during the sixty day review and investigation period to exchange all relevant data and studies and to discuss the results of the review and the investigations contemplated by this Agreement. Each party recognizes that all issues of concern to the other party may not and can not be fully evaluated through this study and each party recognizes there is no commitment regarding further collaboration,participation or study on joint issues following the initial sixty day study period unless both parties agree it is in their best interests. The parties expressly agree that in the event either party determines that further agreements on the issues described in this Agreement are not feasible or appropriate for the party, the party may terminate further investigations and evaluations pursuant to this Agreement. 3. Duplicate Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but which collectively shall be considered one Agreement. Each party represents that each has the right and authority to enter into this Agreement, and that all necessary board or council resolutions have been adopted. 4. Notices. Whenever any notice, demand, or request is required or provided for under this Agreement, such notice, demand, or request shall be provided in writing or by facsimile to the following addresses or such other addresses as may be designated by a party by notice. Notice shall be deemed received when: (1)personally delivered; or (2) when transmitted by facsimile; or (3) three (3) days after having been deposited in a U. S. Postal Service depository to be sent by registered or certified mail, return receipt requested,with all required postage prepaid; or(4) one (1)business day after having been sent by overnight courier: To District: Resource Colorado Water and Sanitation Metropolitan District 141 Union Bld. #150 Lakewood, Colorado 80228 2 Copy to: Chris Paulson, President 4643 S. Ulster St. Suite 1300 Denver, Colorado 80237 Facsimile: (303) 740-8657 And copy to: McGeady Sisneros, P.C. 1675 Broadway, Suite 2100 Denver, Colorado 80202 Facsimile: (303)592-4385 To Keenesburg: Mark Gray Mayor Town of Keenesburg P. O. Box 312 Keenesburg, CO 80643 Facsimile: (303)732-0599 Copy to: Kathleen Harrington Light Harrington &Dawes 1512 Larimer St., Suite 300 Denver, CO 80202 harrington@lhdlaw.com 5. Time is of the Essence. Time is of the essence with respect to each and every aspect of this Agreement, and strict compliance with all time requirements is at the heart of this Agreement and shall be strictly enforced. 6. Authority. The individuals executing this Agreement on behalf of their respective entities are authorized by the entities to execute this Agreement on behalf of their respective entities. 7. Entire Agreement; Modifications. The making, execution and delivery of this Agreement by the Parties has not been induced by any representations, statements, warranties or agreements other than those expressed in this Agreement. This Agreement constitutes the entire understanding between the Parties, and all prior negotiations, agreements and understandings, written or oral, concerning the subject matter of this Agreement are considered superceded and merged herein. Modification of this Agreement by the Parties may be made only by a writing signed by the Party or Parties to be bound by the modification. 8. No Limitation on Sale or Agreements. By entering into this Agreement, neither the District nor the Town shall be limited or restricted from entering into other agreements or transactions for sale or lease of other water rights. 3 9. Controlling Law and Venue. This Agreement shall be governed under and controlled pursuant to the laws of the State of Colorado, and the venue for any disputes hereunder shall be in the District Court, Weld County, State of Colorado. 10. Effective Date of Agreement. This Agreement shall be effective on the last date it is signed by all the parties. 11. Recording. This Agreement shall not be recorded at the office of the Weld County Clerk and Recorder, unless agreed to by both the District and Keenesburg. IN WITNESS HEREOF, the parties execute this Agreement effective as of the date set forth above. TOWN OF KEENESBURG, COLORADO, a Colorado municipal corporation acting by and through its Water Activity Enterprise n By Date: !v 02re7' Marl Gray, Mayor �ttf8VgO AT ST: io SEAL :0 � . �y _ A( Date: b `a U ' C.' 4 M ;OO+I Town Clerk 's♦%N root s RESOURCE COLORADO W AND SANITATION METROPOLITAN DISTRICT, a quasi-m ' ration and political subdivision of the State of Colorado By: r au son Date: 711i)o1 Name:_Christopher Paulson Title: President Attest: Date: ?111 Title:_Assistant Secretary 4 STATE OF COLORADO ) )ss. COUNTY OF WELD ) The foregoing instrument was acknowledged before me this�� day of LTv4,) , 20019? by Christopher Paulson, as President and by cJb ck E,,\-zei , as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado,. WITNESS my hand and official seal. My commission expires; C- -024/ Public 5 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT 2006 ANNUAL REPORT TO SOUTHERN WELD ADVISORY BOARD Pursuant to Section II.C of the Service Plan as approved by the Board of County Commissioners of Weld County, Colorado on August 25, 2004, the Resource Colorado Water and Sanitation Metropolitan District ("District") is required to provide, on an annual basis, the following report to the Southern Weld Advisory Board. Additional questions regarding the information set forth in this report may be directed to the office of the District Manager, Resource Colorado Water and Sanitation Metropolitan District, 141 Union Blvd., Lakewood, CO 80228, (303) 987-0835, during regular business hours and pursuant to the Rules and Regulations adopted by the District. All information provided in this summary is through December 31, 2006. 1. Capital Improvement Progress Report. (a) Summary of Description and Mapping of Completed Improvements from Date of Organization through December 31 of the Year Prior to the Year of the Report. No improvements were completed as of December 31, 2006. Please see response in 1(b) below. (b) Summary of Description and Drawing of Improvements Proposed to be Constructed within 36 Months of January 1 of the Year of the Report ("Three Year CIP Plan"). A Three Year CIP Plan was not prepared by the District as of December 31, 2006, as preliminary planning and engineering was not completed as of year-end. Since its organization in 2004 through December 31, 2006, the District has been focusing on planning, engineering, administrative and legal matters related to the provision of water and wastewater improvements and services to service providers in Weld County. Among the proposed service providers that the District is expected to service are the Pioneer Regional Metropolitan District and Pioneer Metropolitan Districts Nos.1 — 6 (collectively, the"Pioneer Districts"). The Service Plans for the Pioneer Districts were approved by Weld County on February 6, 2006. The District continues to undertake the steps necessary to enable the District to provide water and wastewater services in accordance with its Service Plan, as discussed below. As noted in the 2005 Annual Report, the District applied for and received conditional approval of an amendment to the North Front Range Water Quality Planning Association's (the "Association") Areawide Water Quality Management Plan ("208 Plan"). The 208 Plan designates the District as a Management/Operating Agency and identifies a sewer service area that encompasses the Pioneer Districts' service area. The conditions including: (1) approval of the Weld County Comprehensive Plan Amendment ("Comprehensive Plan") for the proposed development area (service area), and (2) submittal of a utility plan for review to the Association, were satisfied in 2006 when the Weld County Board of County Commissioners (BOCC) approved the Comprehensive Plan and in November of 2006 when the District submitted its utility plan for review by the Association. E:\RESOURCE\2006 Annual Report to Southern Weld Advisory Board(00103624-3).DOC During 2006 the District continued with the engineering and planning aspects of wastewater service for the Pioneer Districts, including exploring the feasibility of providing coordinated wastewater services with other service providers. As noted above, a utility plan and application for site location for the wastewater treatment facility was submitted to the Association on November 16, 2006. That application had not received approval of the Association as of December 31, 2006. The District Board approved membership of the District in the Association in 2006. No further activities regarding the wastewater treatment facilities were undertaken by the District as of December 31, 2006. With respect to water service, in February of 2006, the District filed in Water Division No. 1, an application for determination of rights to ground water in the not nontributary Arapahoe Aquifer underlying approximately 650 acres and in the nontributary Larmie-Fox Hills Aquifer underlying approximately 5,668 acres, which acreages overlap. A decree granting the application was entered on December 29, 2006 entitling the District to withdraw 5.7 acre feet per year from the not nontributary Arapahoe Aquifer and 1,281.9 acre feet per year from the nontributary Laramie-Fox Hills Aquifer subject to the terms of the decree. The District filed an Application for approval of a plan for augmentation including claims for conditional ground water rights, storage rights, change of water rights and appropriative rights of exchange in Case No. 06CW256, Water Division No. 1 on December 14, 2006. As of December 31, 2006, that case was pending before the Water Court. With respect to providing service to other service providers, the District completed the sale of Well 31652FP and associated water rights to the Town of Keenesburg ("Town") on July 26, 2006. The District entered into an intergovernmental agreement with the Town on December 7, 2006 regarding joint use and cost sharing for the pipeline and related facilities servicing said well. See Exhibit E herein for a complete listing of the agreements associated with this transaction. The District anticipates preparing the Three Year CIP Plan in conjunction with an overall feasibility study and comprehensive plan for water and wastewater services. The District anticipates that the Three Year CIP Plan may be available in 2008. (c) Summary of Infrastructure Phasing and Schedules of Improvements Described in Three Year CIP Plan. Please see response in 1(b) above. 2. District Financial Reporting. (a) Annual Budget for Year of Report. See Exhibit A attached hereto. (b) Annual Audit of Financial Statements for the Fiscal Year Ending December 31 of the Year Prior to the Year of the Report. Attached hereto as Exhibit B are audited financial statements for the year ended December 31, 2006. (c) Summary of Total Debt Outstanding and Remaining Amounts of Authorized but Unissued Debt Authorization. See Exhibit C attached hereto. {00103624.DOC v:3) 3. Operations Reporting. (a) Current Rules and Regulations. See Exhibit D attached hereto. (b) Changes to District's Taxing Boundary or Service Area Boundary, as such Terms are Defined in District's Service Plan. There have been no changes to the District's taxing boundary or Service Area boundary, as such terms are defined in District's Service Plan from the date of organization through December 31, 2006. (c) Copies of Executed Intergovernmental Agreements. See Exhibit E attached hereto. (d) Names and Terms of Board Members and Contact Information. Christopher R. Paulson, President JF Companies LLC 4643 S. Ulster Street, Suite 1300 Denver, CO 80237 Telephone: (303) 843-9742 Fax: (303) 843-0143 Term expires: 2008 Jack E. Reutzel, Vice President Reutzel and Associates, LLC 9145 E. Kenyon Avenue, Suite 200 Denver, CO 80237 Telephone: (303) 694-1982 Fax: (303) 694-3831 Term expires: 2008 Joel H. Farkas, Secretary JF Companies LLC 4643 S. Ulster Street, Suite 1300 Denver, CO 80237 Telephone: (303) 843-9742 Fax: (303) 843-0143 Term expires: 2010 {00103624.DOC v.3} Oki/01/2007 14 : 54 FAY: 005/014 Toni L. Serra, Treasurer JF Companies LLC 4643 S. Ulster Street, Suite 1300 Denver, CO 80237 Telephone: (303) 843-9742 Fax: (303) 843-0143 Term expires: 2010 Jean M. Gold,Assistant Secretary IF Companies LLC 4643 S. Ulster Street, Suite 1300 Denver, CO 80237 Telephone: (303) 843-9742 Fax: (303) 843-0143 Term expires: 2008 (e) Schedule and Locations of Regular Board Meetings. Provided for 2006 as Exhibit F. (f) Summary of any Outstanding Litigation. The District has filed an Application for approval of a plan for augmentation in Case No. 06CW256, Water Division No. 1 as described in Section 1(b)herein,which case is pending before the Water Court. Respectfully submitted this I s� day of A451/444 , 2007. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT By: 1 er . Paulson,President Attest: l By; C- `(3 l -'`AC-0 Name: l t-h-‘ 1 5 ar Kti. Title: P;a-k c.re-Are (00103624.DOC v:3) EXHIBIT A 2007 Budget A-1 (00103624.DOC v 3} MClifton Gunderson LLP Certified Public Accountants& Consultants Accountant's Report Board of Directors Resource Colorado Water and Sanitation Metropolitan District Weld County, Colorado We have compiled the accompanying forecasted budget of revenue, expenditures, and fund balance/funds available of the Resource Colorado Water and Sanitation Metropolitan District for the General and Enterprise Funds for the year ending December 31, 2007, including the forecasted estimate of comparative information for the year ending December 31, 2006, in accordance with attestation standards established by the American Institute of Certified Public Accountants. A compilation is limited to presenting in the form of a forecast information that is the representation of management and does not include evaluation of the support for the assumptions underlying the forecast. We have not examined the forecast and, accordingly, do not express an opinion or any other form of assurance on the accompanying budget of revenue, expenditures, and fund balance/funds available or assumptions. Furthermore, there will usually be differences between the forecasted and actual results because events and circumstances frequently do not occur as expected, and those differences may be material. We have no responsibility to update this report for events or circumstances occurring after the date of this report. The actual historical information for the year 2005 is presented for comparative purposes only. Such information is taken from the application for exemption from audit of the District for the year ended December 31, 2005. Management has elected to omit the summary of significant accounting policies required by the guidelines for presentation of a forecast established by the American Institute of Certified Public Accountants. If the omitted disclosures were included in the forecast, they might influence the user's conclusions about the District's results of operations for the forecasted periods. Accordingly, this forecast is not designed for those who are not informed about such matters. We are not independent with respect to the Resource Colorado Water and Sanitation Metropolitan District. ept •O„ Greenwood Village, Colorado December 1, 2006 [j ()fficcs in 15 scurs and AA iI,in.um_I tt HLB International RESOURCE COLORADO WATER AND SANITATION METRO DISTRICT SUMMARY FORECASTED 2007 BUDGET AS ADOPTED WITH 2005 ACTUAL AND 2006 ESTIMATED For the Years Ended and Ending December 31, 12/1/2006 Page 2 ACTUAL ESTIMATED ADOPTED 2005 2006 2007 BEGINNING FUND BALANCE/FUNDS AVAILABLE $ - $ 7,642 $ 1,571 REVENUE Investment income 528 300 100 Water sales - 1,116,800 - Developer advance 224,483 112,000 26,600,000 Total revenue 225,011 1,229,100 26,600,100 TRANSFERS IN - - - Total funds available 225,011 1,236,742 26,601,671 EXPENDITURES General Accounting 6,423 11,600 30,000 District management 18,273 27,500 30,000 Engineering and consulting 75,000 - 500,000 Election costs 58 600 - Insurance 1,322 3,242 3,500 Legal 115,989 63,500 94,000 South Weld Advisory Board - - 10,000 Miscellaneous 304 1,300 1,000 Water purchases - 1,116,800 25,883,200 Contingency - 10,629 48,300 Total expenditures 217,369 1,235,171 26,600,000 TRANSFERS OUT - - - Total expenditures and transfers out requiring appropriation 217,369 1,235,171 26,600,000 ENDING FUND BALANCE/FUNDS AVAILABLE $ 7,642 $ 1,571 $ 1,671 This financial information should be read only in connection with the accompanying accountants report and summary of significant assumptions. RESOURCE COLORADO WATER AND SANITATION METRO DISTRICT PROPERTY TAX SUMMARY INFORMATION For the Years Ended and Ending December 31, 12/1/2006 Page 3 ACTUAL ESTIMATED ADOPTED 2005 2006 2007 ASSESSED VALUATION- WELD COUNTY Residential $ - $ - $ - Commercial - - - Agricultural - 20,330 20,330 State assessed - - - Vacant land - - - Personal property - - - 20,330 20,330 Adjustments - Certified Assessed Value $ - $ 20,330 $ 20,330 MILL LEVY General - - - Debt Service - - - , Temporary Mill Levy Reduction (pursuant to C.R.S.39-5-121) - - - Refund and abatements - - - Total mill levy - - - PROPERTY TAXES General $ - $ - $ - Debt Service - - - Temporary Mill Levy Reduction - - - Refund and abatements - - - Levied property taxes - - - Adjustments to actual/rounding - - - Budgeted property taxes $ - $ - $ - BUDGETED PROPERTY TAXES General $ - $ - $ - Debt Service - - - $ - $ - $ - This financial information should be read only in connection with the accompanying accountants report and summary of significant assumptions. RESOURCE COLORADO WATER AND SANITATION METRO DISTRICT GENERAL FUND FORECASTED 2007 BUDGET AS ADOPTED WITH 2005 ACTUAL AND 2006 ESTIMATED For the Years Ended and Ending December 31, 12/1/2006 Page 4 ACTUAL ESTIMATED ADOPTED 2005 2006 2007 BEGINNING FUND BALANCE $, - $ 6,271 1,571 REVENUE Investment income 528 300 100 Developer advance 32,123 70,000 150,000 Total revenue 32,651 70,300 150,100 TRANSFERS IN Enterprise fund - - - Total transfers in - - - Total funds available 32,651 76,571 151,671 EXPENDITURES Accounting 6,423 11,500 20,000 District management 18,273 27,500 30,000 Election costs 58 600 - Insurance 1,322 3,242 3,500 Legal - 20,500 50,000 South Weld Advisory Board - - 10,000 Miscellaneous 304 1,300 1,000 Contingency - 10,358 35,500 Total expenditures 26,380 75,000 150,000 TRANSFERS OUT Enterprise Fund - - - Total transfers out - - - Total expenditures and transfers out requiring appropriation 26,380 75,000 150,000 ENDING FUND BALANCE $ 6,271 $ 1,571 $ 1,671 EMERGENCY RESERVE $ 100 $ 100 $ 100 This financial information should be read only in connection with the accompanying accountants report and summary of significant assumptions. RESOURCE COLORADO WATER AND SANITATION METRO DISTRICT ENTERPRISE FUND FORECASTED 2007 BUDGET AS ADOPTED WITH 2005 ACTUAL AND 2006 ESTIMATED For the Years Ended and Ending December 31, 12/1/2006 Page 5 ACTUAL ESTIMATED ADOPTED 2005 2006 2007 BEGINNING FUNDS AVAILABLE $ - $ 1,371 $ - REVENUE Water sales - 1,116,800 - Developer advance 192,360 42,000 26,450,000 Total revenue 192,360 1,158,800 26,450,000 TRANSFERS IN General Fund - - - Total transfers in - - - Total funds available 192,360 1,160,171 26,450,000 EXPENDITURES Accounting - 100 10,000 Engineering and consulting 75,000 - 500,000 Legal 115,989 43,000 44,000 Water purchases - 1,116,800 25,883,200 Contingency - 271 12,800 Total expenditures 190,989 1,160,171 26,450,000 TRANSFERS OUT General Fund - - - Total transfers out - - - Total expenditures and transfers out requiring appropriation 190,989 1,160,171 26,450,000 ENDING FUNDS AVAILABLE $ 1,371 $ - $ - This financial information should be read only in connection with the accompanying accountants report and summary of significant assumptions. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT 2007 BUDGET SUMMARY OF SIGNIFICANT ASSUMPTIONS Services Provided The District was organized to provide construction, installation, financing and operation of public improvements, including water and sanitary sewer. The District's service area is located entirely within Weld County, Colorado. The District was formed by Court Order on November 16, 2004, with its formation election held on November 2, 2004. The District prepares its budget on the modified accrual basis of accounting. Revenue Developer Advance The District is in the development stage. As such, the operating, administrative and capital expenditures for 2007 are to be funded by the Developer. Developer advances are recorded as revenue for budget purposes with an obligation for future repayment when the District is financially able to reimburse the Developer from bond proceeds and other available revenue. Investment Income Interest earned on the District's available funds has been estimated based on an average interest rate of approximately 4 %. Expenditures Administrative Expenditures Administrative and operating expenditures include the estimated services necessary to maintain the District's administrative viability such as legal, management, accounting, insurance, banking and meeting expense. Capital Outlay The District anticipates infrastructure improvements during 2007 as displayed on page 5. Debt and Leases The District has no outstanding debt or any operating or capital leases. Page 6 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT 2007 BUDGET SUMMARY OF SIGNIFICANT ASSUMPTIONS (Continued) Reserves Emergency Reserve The District has provided for an emergency reserve fund equal to at least 3% of fiscal year spending for 2007, as defined under TABOR. This information is an integral part of the accompanying forecasted budget. Page 7 EXHIBIT B Annual Audited Financial Statements for the year ended December 31, 2006 • {00103624.DOC v:3} B-1 t V�. k ,:.,...4 S ry;Fu y„ { `fib , 4 :,,�, 7} '.' j 14O. '} Y 4 j ' a 5 t ''`f Fg k r f q 44++k ax 1 � ; 4 + ; •+' 1 3 te ^`C;y}tL4' {{"'f' iD Y .4 4{,`� ,:jet l R,a „, 44� `4�� Y X t,34 ,,4' 3r" y , 4 ?s,* n turd{ r tn� f '�" a RESOURCE COLORADO WATER AND S t , y SANITATION METROPOLITAN DISTRICT i s to r xk „ 5" Weld County, Colorado f, ,5„5"...,".g","" "^ • x h� g FINANCIAL STATEMENTS _ g ; ,ham December 37, 2006 y; xnv,..', } h {� " 'Y:"`{ kx EC > t '$T "%s`. '31'4-4:4 y 4 fix , iF G `d£.. t tz 54 ' Y Y x 5k` $' �'CS' F m;y'' wad" 4r'� v t.+ -112°,, r.. �,,'r+ _i •« F,440f 1 '9 R i.N k q 3: 4 Yr-444.14-,..,aY ',,,t,--".. -BSc 4 4.it 'M ' tx Z ; _,‘.4.1. X 41 4' .- ; s' e„ z e ii;1.4.:„...e+..,,..* I .$, y' ,„:! �� " t TABLE OF CONTENTS PAGE INDEPENDENT AUDITOR'S REPORT 1 BASIC FINANCIAL STATEMENTS Statement of Net Assets 1 Statement of Activities 2 Balance Sheet - Governmental Funds 3 Statement of Revenue, Expenditures and Changes in Fund Balance - Governmental Funds 4 Reconciliation of the Statement of Revenue, Expenditures and Changes in Fund Balance of Governmental Funds to the Statement of Activities 5 General Fund - Statement of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual 6 Statement of Net Assets - Proprietary Fund 7 Statement of Revenue, Expenditures and Changes in Net Assets - Proprietary Fund 8 Statement of Cash Flows - Enterprise Fund 9 Notes to Financial Statements 10 SUPPLEMENTAL INFORMATION 19 Capital Projects Fund- Schedule of Revenue, Expenditures and Changes in Fund Balance - Budget and Actual 20 Enterprise Fund - Schedule of Revenue, Expenditures and Changes in Net Assets - Budget and Actual 21 Mason Russell West, LLC 739 WEST LITTLETON BLVD. LITTLETON,CO 80120-2337 TELEPHONE 303-797-9101 FAX 303-795-3356 E-MAIL:cpas@mrwllc.com DICK MASON CERTIFIED PUBLIC ACCOUNTANTS RAY RUSSELL,JR. CONSULTING SERVICES Report of Independent Certified Public Accountants To the Board of Directors Resource Colorado Water&Sanitation Metropolitan District We have audited the accompanying financial statements of the governmental activities and the major funds of Resource Colorado Water& Sanitation Metropolitan District as of and for the year ended December 31, 2006,which collectively comprise the District's basic financial statements as listed in the Table of Contents. These fmancial statements are the responsibility of the District's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and in accordance with the Colorado Local Government Audit Law. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.An audit includes examining,on a test basis,evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The District declined to present a Management's Discussion and Analysis for the year ended December 31, 2006. Presentation of such items is not a required part of the basic financial statements,but is supplementary information required by the Governmental Accounting Standards Board. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and the major funds of Resource Colorado Water & Sanitation Metropolitan District as of December 31, 2006,and the budgetary comparison for the General Fund for the year then ended in conformity with accounting principles generally accepted in the United States of America. Our audit was made for the purpose of forming an opinion on the District's basic financial statements taken as a whole. The accompanying supplemental information is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the District's basic financial statements and, in our opinion, is fairly stated in all material respects in relation toot e District's basic financial statements taken as a whole. Ada Littleton,Colorado July 17,2007 IGAF o.,ow,o1 BASIC FINANCIAL STATEMENTS RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT STATEMENT OF NET ASSETS December 31, 2006 Governmental Business-Type Activities Activities Total ASSETS Cash $ 1,856 $ 1,978 $ 3,834 Prepaid expenses 170 - 170 Total assets 2,026 1,978 4,004 LIABILITIES Accounts payable 4,985 2,053 7,038 Directors fees payable- Net 3,048 - 3,048 FICA payable 505 - 505 Developer advance payable 184,682 130,802 315,484 Interest payable on developer advances 16,271 10,056 26,327 Total liabilities 209,491 142,911 352,402 NET ASSETS Unrestricted (207,465) (140,933) (348,398) Total net assets $ (207,465) $ (140,933) $ (348,398) These financial statements should be read only in connection with the accompanying notes to financial statements. 1 Vl f- v1 v1 NV o0 d' N V' O O V' n P N 0 Do in ' n v1 CC e+t H ,-- ._, � C EA be Ca ,Th _ 69 VI N N n 0 en a i " Al N [N N or) co n C L., '> ' V C I n M N .V O• et u y •t CJ C! 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RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT BALANCE SHEET GOVERNMENTAL FUNDS December 31, 2006 Total Capital Governmental General Projects Funds ASSETS Cash $ 1,856 $ - $ 1,856 Prepaid expenses 170 - 170 TOTAL ASSETS $ 2,026 $ - $ 2,026 LIABILITIES AND FUND BALANCES LIABILITIES Accounts payable $ 4,985 $ - $ 4,985 Directors fees payable -Net 3,048 - 3,048 FICA payable 505 - 505 Total liabilities 8,538 - 8,538 FUND BALANCES Unrestricted (6,512) - (6,512) Total fund balances (6,512) - (6,512) TOTAL LIABILITIES AND FUND BALANCES $ 2,026 $ - Amounts reported for governmental activities in the statement of net assets are different because: Long-term liabilities, including developer advance payable, are not due and payable in the current period and, therefore, are not reported in the funds. Developer advance payable (184,682) Accrued interest on developer advances (16,271) Net assets of governmental activities $ (207,465) These financial statements should be read only in connection with the accompanying notes to the financial statements. 3 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTAL FUNDS Year Ended December 31, 2006 Total Capital Governmental General Projects Funds REVENUE Interest income $ 305 $ - $ 305 Developer advance 52,354 - 52,354 Total revenue 52,659 - 52,659 EXPENDITURES Accounting 12,180 - 12,180 Directors' fees 3,300 - 3,300 Insurance and bonds 3,242 - 3,242 Election expenses 499 - 499 District management 23,901 - 23,901 Legal services 21,089 - 21,089 Miscellaneous 979 - 979 Payroll taxes 252 - 252 Total expenditures 65,442 - 65,442 EXCESS OF REVENUE OVER (UNDER) EXPENDITURES (12,783) - (12,783) OTHER FINANCING SOURCES (USES) Transfer to other funds - (1,372) (1,372) Total other financing sources (uses) - (1,372) (1,372) NET CHANGE IN FUND BALANCE (12,783) (1,372) (14,155) FUND BALANCE - BEGINNING OF YEAR 6,271 1,372 7,643 FUND BALANCE - END OF YEAR $ (6,512) $ - $ (6,512) These financial statements should be read only in connection with the accompanying notes to the financial statements. 4 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT RECONCILIATION OF THE STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES Year Ended December 31, 2006 Amounts reported for governmental activities in the Statement of Activities are different because: Governmental funds net change in fund balance $ (14,155) Some revenues/expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as revenues/expenditures in governmental funds. Developer advance payable (52,354) Accrued interest on developer advances - Change in liability (11,800) Changes in net assets of governmental activities $ (78,309) These financial statements should be read only in connection with the accompanying notes to financial statements. 5 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT GENERAL FUND STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL Year Ended December 31, 2006 Variance with Original and Final Budget Final Budget Actual Positive Amounts Amounts (Negative) REVENUE Interest income $ 100 $ 305 $ 205 Developer advance 145,000 52,354 (92,646) Total revenue 145,100 52,659 (92,441) EXPENDITURES Accounting 20,000 12,180 7,820 Directors' fees - 3,300 (3,300) Insurance and bonds 2,000 3,242 (1,242) Election expenses - 499 (499) District management 22,000 23,901 (1,901) Legal services 50,000 21,089 28,911 Miscellaneous 1,000 979 21 Payroll taxes - 252 (252) Contingency 50,000 - 50,000 Total expenditures 145,000 65,442 79,558 EXCESS OF REVENUE OVER (UNDER) EXPENDITURES 100 (12,783) (12,883) FUND BALANCE - BEGINNING OF YEAR 300 6,271 5,971 FUND BALANCE - END OF YEAR $ 400 $ (6,512) $ (6,912) These financial statements should be read only in connection with the accompanying notes to financial statements. 6 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT STATEMENT OF NET ASSETS PROPRIETARY FUND December 31, 2006 Enterprise Fund ASSETS Cash $ 1,978 Total assets 1,978 LIABILITIES Accounts payable 2,053 Developer advance payable 130,802 Interest payable on developer advances 10,056 Total liabilities 142,911 NET ASSETS $ (140,933) These financial statements should be read only in connection with the accompanying notes to the financial statements. 7 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT STATEMENT OF REVENUE, EXPENDITURES AND CHANGES IN NET ASSETS PROPRIETARY FUND Year Ended December 31, 2006 Enterprise Fund OPERATING REVENUE $ - EXPENSES Accounting 13 Legal services 35,540 Other 4,540 Total expenses 40,093 OPERATING INCOME (LOSS) (40,093) NONOPERATING REVENUE AND EXPENSES Interest expense 532 OTHER FINANCING SOURCES (USES) Operating transfers in 1,372 Total other financing sources (uses) 1,372 CHANGE IN NET ASSETS (39,253) NET ASSETS - BEGINNING OF YEAR (101,680) NET ASSETS - END OF YEAR $ (140,933) These financial statements should be read only in connection with the accompanying notes to the financial statements. 8 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT STATEMENT OF CASH FLOWS ENTERPRISE FUND Year Ended December 31, 2006 CASH FLOWS FROM OPERATING ACTIVITIES Cash payments to vendors $ (38,040) Net cash(required) by operating activities (38,040) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Developer advances 38,646 Transfer from other fund 1,372 Net cash provided by noncapital financing activities 40,018 CASH FLOWS FROM CAPITAL FINANCING ACTIVITIES Purchase of water rights * (1,116,800) Sale of water rights * 1,116,800 Net cash provided by capital financing activities - NET INCREASE IN CASH AND CASH EQUIVALENTS 1,978 CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR - CASH AND CASH EQUIVALENTS - END OF YEAR $ 1,978 Reconciliation of operating income (loss) to net cash provided by operating activities Operating loss $ (40,093) Increase in accounts payable 2,053 Net cash (required) by operating activities $ (38,040) * Noncash transactions These financial statements should be read only in connection with the accompanying notes to the financial statements. 9 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 1 - DEFINITION OF REPORTING ENTITY Resource Colorado Water and Sanitation District (District), a quasi-municipal corporation was organized on November 19, 2004 and is governed pursuant to provisions of the Colorado Special District Act. The District's service area is located in Weld County, Colorado. The District was established to provide construction, installation, financing and operation of public water, sanitation and storm drainage facilities and services, together with ancillary street and mosquito control improvements and facilities. The District is limited by its service plan to providing such facilities and services to other municipal service providers (Service Providers) and may not directly serve individual customers. The District has established the Resource Colorado Water and Sanitation Metropolitan District Water Activity Enterprise (District Enterprise) by resolution adopted on June 20, 2005 to provide such services. The District Board members also serve as the Board members of the District Enterprise. The District has no employees and all operations and administrative functions are contracted. However, because the District Enterprise does not own significant capital assets, the operations and administrative functions of the District and the District Enterprise currently focus on compliance matters and administration of funding agreements and do not include traditional operation or maintenance of any tangible in-ground facilities or improvements. The District follows the Governmental Accounting Standards Board (GASB) accounting pronouncements which provide guidance for determining which governmental activities, organizations and functions should be included within the financial reporting entity. GASB pronouncements set forth the financial accountability of a governmental organization's elected governing body as the basic criterion for including a possible component governmental organization in a primary government's legal entity. Financial accountability includes, but is not limited to, appointment of a voting majority of the organization's governing body, ability to impose its will on the organization, a potential for the organization to provide specific financial benefits or burdens and fiscal dependency. The District is not financially accountable for any other organization, nor is the District a component unit of any other primary governmental entity. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The more significant accounting policies of the District are described as follows: Government-wide and Fund Financial Statements The government-wide financial statements include the statement of net assets and the statement of activities. These financial statements include all of the activities of the District. The effect of 10 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) interfund activity has been removed from these statements to the extent possible. Both statements distinguish between governmental activities, which normally are supported by taxes and intergovernmental revenues, and business-type activities, which rely to a significant extent on fees and charges for support. The statement of net assets reports all financial and capital resources of the District. The difference between the assets and liabilities of the District is reported as net assets. The statement of activities demonstrates the degree to which the direct and indirect expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services or privileges provided by a given function or segment, and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and proprietary funds are reported as separate columns in the fund financial statements. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Grants and similar items are recognized as revenues as soon as all eligibility requirements imposed by the provider have been met. Depreciation, when applicable, is computed and recorded as an operating expense. Expenditures for property, plant and equipment are shown as increases in assets and redemption of bonds and notes are recorded as a reduction in liabilities. The District has elected to follow Governmental Accounting Standards Board pronouncements in both the government-wide and proprietary fund financial statements. Therefore, statements issued by the Financial Accounting Standards Board after November 30, 1989 are not applied. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the 11 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. The major sources of revenue susceptible to accrual are property taxes and user fees. Expenditures, other than interest on long- term obligations are recorded when the liability is incurred or the long-term obligation paid. All other revenue items are considered to be measurable and available only when cash is received by the District. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. Operating revenues consist of charges to customers for goods or services provided. Operating expenses for enterprise funds include the cost of sales and services and administrative expenses. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses or capital contributions. When both restricted and unrestricted resources are available for use, it is the government's policy to use restricted resources first, then unrestricted resources as they are needed. The District reports the following major governmental funds: The General Fund is the District's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Capital Projects Fund is used to account for financial resources to be used for the acquisition and construction of capital equipment and facilities. The District reports the following major proprietary fund: The Enterprise Fund accounts for the activities related to offering of water and sanitary sewer services to Service Providers within the Districts' service area. Budgets In accordance with the State Budget Law, the District's Board of Directors holds public hearings in the fall each year to approve the budget and appropriate the funds for the ensuing year. The appropriation is at the total fund expenditures level and lapses at year end. The District's Board of Directors can modify the budget by line item within the total appropriation without notification. The appropriation can only be modified upon completion of notification and publication requirements. The budget includes each fund on its basis of accounting unless otherwise indicated. 12 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Pooled Cash and Investments The District follows the practice of pooling cash and investments of all funds to maximize investment earnings. Except when required by trust or other agreements, all cash is deposited to and disbursed from a single bank account. Cash in excess of immediate operating requirements is pooled for deposit and investment flexibility. Investment earnings are allocated periodically to the participating funds based upon each fund's average equity balance in the total cash. Investments are carried at fair value. Cash and Cash Equivalents For purposes of the statement of cash flows, the District considers cash deposits and highly liquid investments (including restricted assets) with a maturity of three months or less when purchased, to be cash equivalents. Capital Assets Capital assets, which include property, plant, equipment, and infrastructure assets (e.g. roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business- type activities columns in the government-wide financial statements. Capital assets are defined by the District as assets with an initial, individual cost of more than $5,000. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. While the District presently does not have any tangible, in-ground facilities or improvements, the costs of normal maintenance and repairs that do not add to the value of the asset or materially extend the life of the asset will not be capitalized. Improvements will be capitalized and depreciated over the remaining useful lives of the related fixed assets, as applicable. Fund Equity In the fund financial statements, governmental funds report reservations of fund balance for amounts that are legally segregated or are not subject to future appropriation. Designations of unreserved fund balances indicate management's intention for future utilization of such funds and are subject to change by management. 13 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The District considers all unreserved fund balances to be "reserves" for future operations or capital replacement as defined within Article X, Section 20 of the Constitution of the State of Colorado. Deficits The following individual funds had deficits reported in the fund financial statements as of December 31, 2006: General Fund $ (6,512) Enterprise Fund $ (140,933) The deficits will be eliminated through developer advances in 2007. NOTE 3 - CASH Cash as of December 31, 2006 are classified in the accompanying financial statements as follows: Statement of net assets: Cash $ 3,834 Total cash Cash and investments as of December 31, 2006 consist of the following: Deposits with financial institutions $ 3,834 Total cash and investments 3 834 Cash Deposits The Colorado Public Deposit Protection Act (PDPA) requires that all units of local government deposit cash in eligible public depositories. Eligibility is determined by state regulators. Amounts on deposit in excess of federal insurance levels must be collateralized. The eligible collateral is determined by the PDPA. PDPA allows the institution to create a single collateral pool for all public funds. The pool for all the uninsured public deposits as a group is to be maintained by another institution or held in trust. The market value of the collateral must be at least equal to the aggregate uninsured deposits. 14 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 3 - CASH (CONTINUED) The State Commissioners for banks and financial services are required by statute to monitor the naming of eligible depositories and reporting of the uninsured deposits and assets maintained in the collateral pools. At December 31, 2006, the District's cash deposits had a bank balance of$2,755 and a carrying balance of$3,834. NOTE 4 - CAPITAL ASSETS An analysis of the changes in capital assets for the year ended December 31, 2006. Balance at Balance at December 31, December 31, 2005 Increases Decreases 2006 Business-type Activities Capital assets, not being depreciated: Water rights $ - $ 1 116 800 $ 1 116 800 $ - NOTE 5 - NET ASSETS The District's unrestricted net assets as of December 31, 2006 totaled $(207,465) for governmental activities and $(140,933) for business-type activities, respectively. NOTE 6 - RELATED PARTIES The members of the Board of Directors are employees, owners, or are otherwise affiliated with the Gateway American Resources LLC (the Developer) and JF Companies, LLC, a developer- related entity, and may have conflicts of interest in dealing with the District. 15 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 7 - AGREEMENTS 2004 and 2005 Operation Funding Agreement Effective on December 14, 2004, the District entered into the 2004 and 2005 Operation Funding Agreement with the Developer whereby the Developer is required to and has agreed to provide funding for operations and maintenance expenses of the District expected to be incurred in 2004 and 2005 up to a maximum shortfall amount of $50,000 and $60,000 for the 2004 and 2005, respectively. Any advances of funds made by the Developer accrue simple interest at 8% per year from the date of the advance until paid. The District has agreed to repay the Developer advances and accrued interest subject to the availability of funds and subject to annual appropriation. Accrued interest must be paid prior to principal. The obligation of the District to repay the Developer pursuant to this agreement is not a debt or indebtedness of the District. The agreement terminates on December 31, 2044. 2006 Operation Funding Agreement On June 10, 2006, effective January 1, 2006, the District Enterprise entered into the 2006 Operation Funding Agreement with the Developer whereby the Developer is required to and has agreed to provide funding for operations and maintenance expenses of the District Enterprise expected to be incurred in 2006 up to a maximum shortfall amount of $145,000 for 2006. Any advances of funds made by the Developer accrue simple interest at 8% per year from the date of the advance until paid. The District Enterprise has agreed to repay the Developer advances and accrued interest subject to the availability of funds and subject to annual appropriation. Accrued interest must be paid prior to principal. The obligation of the District Enterprise to repay the Developer pursuant to this agreement is not a debt or indebtedness of the District Enterprise. The agreement terminates on December 31, 2046. The 2006 Operation Funding Agreement has priority of repayment with respect to the 2007 Operation Funding Agreement. 2007 Operation Funding Agreement On November 8, 2006, the District Enterprise entered into the 2007 Operation Funding Agreement with the Developer whereby the Developer is required to and has agreed to provide funding for operations and maintenance expenses of the District Enterprise expected to be incurred in 2007 up to a maximum shortfall amount of $150,000 for 2007. Additional Developer advances may be requested in writing above the maximum shortfall amount and must be funded by the Developer. Any advances of funds made by the Developer accrue simple interest at 8% per year from the date of the advance until paid. The District Enterprise 16 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 7 - AGREEMENTS (CONTINUED) has agreed to repay the Developer advances and accrued interest subject to the availability of funds and subject to annual appropriation. Accrued interest must be paid prior to principal. The obligation of the District Enterprise to repay the Developer pursuant to this agreement is not a debt or indebtedness of the District Enterprise. The agreement terminates on December 31, 2047. Project Funding and Reimbursement Agreement On January 16, 2006, effective as of December 14, 2004, the District Enterprise entered into a Project Funding and Reimbursement Agreement with the Developer. Under the terms of this agreement the District has agreed to construct certain public improvements to be paid for through advances of funds to the District Enterprise by the Developer. Any advances of funds made by the Developer under this agreement accrue simple interest at 8.0% per year from the date of advance until paid. The District Enterprise has agreed to repay the Developer advances and accrued interest subject to availability of funds and subject to annual appropriation. Accrued interest on Developer advances must be paid prior principal. The obligation of the District Enterprise to repay the Developer pursuant to this agreement is not a debt or indebtedness of the District Enterprise. The agreement terminates on December 31, 2045. Keenesburg IGA The District has entered into an intergovernmental agreement with the Town of Keenesburg whereby the District sold water rights associated with Well No. 31652 FP (Well), a parcel of land (Tank Site), and easements to and from these, to the Town of Keenesburg for consideration of $1,116,800. With this agreement, the Town will also build, operate, and maintain for the District an access point to the Keenesburg Well Water Transmission Line, as well as a water storage tank at the Tank Site that is expected to mutually benefit both the Town and the District in the operation of their respective water systems and the provision of services. The District retained the right to all water delivered pursuant to the Well that is not consumed and is available to be recaptured, reclaimed, reused or otherwise used after a first use of the water in an amount up to 77.7 acre feet per year. NOTE 8 - OPERATING TRANSFERS The District had the following interfund transaction for the year ended December 31, 2006: The Capital Projects Fund transferred accumulated proceeds to the Enterprise Fund in the amount of$1,372. 17 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT NOTES TO FINANCIAL STATEMENTS December 31, 2006 NOTE 9 - RISK MANAGEMENT The District is exposed to various risks of loss related to torts, thefts of, damage to, or destruction of assets; errors or omissions; injuries to employees, or acts of God. The District is a member of the Colorado Special Districts Property and Liability Pool (Pool) as of December 31, 2006. The Pool is an organization created by intergovernmental agreement to provide property, liability, public officials liability, boiler and machinery and workers compensation coverage to its members. Settled claims have not exceeded this coverage in any of the past three fiscal years. The District pays annual premiums to the Pool for liability, property, public officials liability and workers compensation coverage. In the event aggregated losses incurred by the Pool exceed amounts recoverable from reinsurance contracts and funds accumulated by the Pool, the Pool may require additional contributions from the Pool members. Any excess funds which the Pool determines are not needed for purposes of the Pool may be returned to the members pursuant to a distribution formula. NOTE 10 - TAX, SPENDING AND DEBT LIMITATIONS Article X, Section 20 of the Colorado Constitution, commonly known as the Taxpayer's Bill of Rights (TABOR) contains tax, spending, revenue and debt limitations that apply to the State of Colorado and all local governments. Spending and revenue limits are determined based on the prior year's Fiscal Year Spending adjusted for allowable increases based upon inflation and local growth. Fiscal Year Spending is generally defined as expenditures plus reserve increases with certain exceptions. Revenue in excess of the Fiscal Year Spending limit must be refunded unless the voters approve retention of such revenue. TABOR requires local governments to establish Emergency Reserves. These reserves must be at least 3% of Fiscal Year Spending (excluding bonded debt service). Local governments are not allowed to use the emergency reserves to compensate for economic conditions, revenue shortfalls, or salary or benefit increases. The District's management believes it is in compliance with the provisions of TABOR. However, TABOR is complex and subject to interpretation. Many of the provisions, including the interpretation of how to calculate Fiscal Year Spending limits will require judicial interpretation. This information is an integral part of the accompanying financial statements. 18 THIS PAGE INTENTIONALLY LEFT BLANK SUPPLEMENTAL INFORMATION 19 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT CAPITAL PROJECTS FUND SCHEDULE OF REVENUE, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL Year Ended December 31, 2006 Variance with Original and Final Budget Final Budget Actual Positive Amounts Amounts (Negative) REVENUE Total revenue EXPENDITURES Total expenditures - - - EXCESS OF REVENUE OVER(UNDER) (UNDER) EXPENDITURES - - - OTHER FINANCING SOURCES (USES) Transfer to other fund - (1,372) (1,372) Total other financing sources (uses) - (1,372) (1,372) EXCESS OF REVENUE AND OTHER FINANCING SOURCES OVER(UNDER) EXPENDITURES AND OTHER USES - (1,372) (1,372) FUND BALANCE - BEGINNING OF YEAR - 1,372 1,372 FUND BALANCE - END OF YEAR 20 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT ENTERPRISE FUND SCHEDULE OF REVENUE, EXPENDITURES AND CHANGES IN NET ASSETS - BUDGET AND ACTUAL Year Ended December 31, 2006 Variance with Original and Final Budget Final Budget Actual Positive Amounts Amounts (Negative) REVENUE Developer advance $ 27,507,200 $ 38,646 $ (27,468,554) Water sales - 1,116,800 1,116,800 Total revenue 27,507,200 1,155,446 (26,351,754) EXPENDITURES Accounting - 13 (13) Legal 7,200 35,540 (28,340) Water purchase 27,000,000 1,116,800 25,883,200 Other - 4,540 (4,540) Engineering 500,000 - 500,000 Total expenditures 27,507,200 1,156,893 26,350,307 OTHER REVENUE AND EXPENDITURES Transfer from other fund - 1,372 1,372 Total other revenue and expenditures - 1,372 1,372 EXCESS OF REVENUE OVER (UNDER) EXPENDITURES - (75) (75) FUNDS AVAILABLE - BEGINNING OF YEAR - - - FUNDS AVAILABLE - END OF YEAR $ - (75) $ (75) ADJUSTMENTS TO RECONCILE BUDGET BASIS TO GAAP BASIS BEGINNING NET ASSETS (101,680) Developer advance (38,646) Water sales (1,116,800) Water purchase 1,116,800 Interest expense on developer advance - accrued (532) ENDING NET ASSETS $ (140,933) 21 THIS PAGE INTENTIONALLY LEFT BLANK EXHIBIT C Summary of Debt and Debt Authorization (00103624_DOC v 3) C-1 MEMORANDUM To: Weld County, CO From: McGeady Sisneros, PC Date: July 26, 2007 Re: Resource Colorado Water and Sanitation Metropolitan District Election Authorization as of 12/31/06 Princippl Amotmntwof Principal Amount Principal Amount. Authorization of Authorization of Authorized Debt Used Remaining Purpose - Improvments 5A Streets $324,000,000.00 $0.00 $324,000,000.00 56 Water Supply System $324,000,000.00 $0.00 $324,000,000.00 5C Sanitary Sewer System $324,000,000.00 $0.00 $324,000,000.00 5D Mosquito Control $324,000,000.00 $0.00 $324,000,000.00 Improvements Total $1,296,000,000.00 $0.00 $1,296,000,000.00 Purpose-Other Authorizations Refunding of District debt or other 5E obligations $324,000,000.00 $0.00 $324,000,000.00 IGAs that are MFY obligations; payable from unlimited ad valorem 5F property tax levy $324,000,000.00 $0.00 $324,000,000.00 Operating Expenses and Reimbursement of Operating 5G Advances to the District $50,000,000.00 $0.00 $50,000,000.00 IGAs that are MFY obligations; payable from unlimited ad valorem 5H property tax levy $324,000,000.00 $0.00 $324,000,000.00 IGAs for Regional Improvements 51 that are MFY obligations Allowed Authority to Collect/Spend Facilities 5 j Fees,charges,tap fees Allowed Note: IGA = Intergovernmental Agreement; MFY = Multiple Fiscal Year Debt: All authorized debt is in the form of revenue bonds or other obligations of the District including but not limted to contracts, leases and other agreements,except as otherwise noted. Date of Last Election: November 2, 2004 E:\RES0URCE\Resource Colo,R43§€2006 Annual Rprt-Debt author 12-31-06 (00104139) (4) EXHIBIT D Current Rules and Regulations (Amended effective April 11, 2007) {00103624.DOC e3} D-1 c753- 1 03 RULES AND REGULATIONS OF THE RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT The Board of Directors of the Resource Colorado Water and Sanitation Metropolitan District ("District") hereby declares that the following Rules and Regulations have been prepared and adopted to provide for the construction, administration and operation of the District's public Water and Wastewater Systems (as defined herein). These Rules and Regulations, or any amendment thereto, shall be effective as of the effective date set forth below upon adoption of a resolution by a majority of the Board of Directors of the District at a public meeting approving these Rules and Regulations. The Board of Directors of the District hereby expressly reserves the right to make any lawful addition and/or revisions in these Rules and Regulations when and as they may become advisable to properly manage the District and to promote the peace, health, safety and welfare of the inhabitants of the Service Providers that will be served by the District. These Rules and Regulations are supplementary to, and are not to be construed as, any abridgement of any lawful rights of the Board of Directors of the District as outlined in the Colorado Revised Statutes governing Special Districts, including the right to disconnect or to refuse permission to connect any Service Provider to the District's Water or Wastewater System for violation of these Rules and Regulations or any other applicable law of the State of Colorado. RESOURCE COLORADO WATER AND SANITATION METROP N DISTRICT By: Chris R. Paulson, President Attest: By: (4.41.t kik CO Name: Tern e rY ) Title: t 0( (E'*c, ADOPTED EFFECTIVE JULY 18,2005 LAST AMENDED EFFECTIVE APRIL 11, 2007 (00096389.DOC v:1) TABLE OF CONTENTS ARTICLE 1. GENERAL PROVISIONS 1 1.1 General 1.1.1 Authority 1 1.1.2 Scope 1 1.1.3 Policy 1 1.1.4 Purpose 1 1.1.5 Service Plan Limitations 1 1.1.6 Initial Service Area 1 1.1.7 Enterprises and Authorities 2 1.2 Construction of Rules and Regulations. 2 1.2.1 Intent of Construction 2 1.2.2 Incorporation of Decrees and Rules and Regulations by Other Governmental Entities: 2 1.2.3 Amendment 3 1.2.4 Conflict 3 1.2.5 Severability 3 1.2.6 Modification, Waiver and Suspension of Rules 3 1.2.7 Saving Provision 3 1.2.8 Repeal of Conflicting Resolutions 3 1.3 District Facilities 3 1.3.1 Ownership and Maintenance of District Facilities 3 1.3.2 Service Provider System Compliance with Design Standards 4 1.3.3 Encroachment of the District's Easements 4 1.3.4 Use of District's Easements 4 1.3.5 Non-District Water Wells Prohibited 4 1.4 Inspections 4 1.4.1 Powers and Authority of District 4 1.4.2 Construction Inspection 5 1.5 Protection of District Facilities 5 1.5.1 Compliance with Statutes and Regulations 5 1.5.2 Locate Information 5 1.6 Definitions. 5 1.6.1 Definitions for Water and Wastewater Systems 5 ARTICLE 2. REQUIREMENTS FOR ACQUIRING WATER OR WASTEWATER SERVICE FROM THE DISTRICT 13 2.1 Water or Wastewater Service. 13 2.1.1 Policy 13 2.1.2 No Obligation of Service 13 2.1.3 Revocation of Service 13 2.1.4 Covenants 13 2.1.5 Contracts and Agreements. 13 2.1.6 Denial of Service 14 2.1.7 Application for System Review 14 Other Conditions for Service 15 {00096389.DOC va} 2.1.9 District16 2.1.10 Procedural Requirements for Acquiring Water or Wastewater Service: 17 2.2 Fees, Rates and Service Charges. 17 2.2.1 Policy. 17 2.2.2 Payment of Fees 17 2.2.3 Schedule and Types of Fees, Rates and Service Charges: 17 2.2.4 Billing Procedures for Service Charges 18 ARTICLE 3. WATER SERVICE 19 3.1 Principles for Supplying Water Resources to Public Water Service Providers 19 3.1.1 Policy Regarding Use of District Water System 19 3.1.2 Water Policy 19 3.1.3 Scope of District Water Supply 19 3.1.4 Ownership of Water and Return Flows 19 3.1.5 Consent to Groundwater Appropriation 19 3.2 District Water System and Service Provider Systems 20 3.2.1 Ownership and Maintenance of Service Provider Water Service Facilities and Lines 20 3.2.2 Ownership and Maintenance of Master Water Meters and Related District Facilities: 20 3.2.3 Non-Potable Irrigation System 20 3.3 Protection of District Water Supply. 20 3.3.1 Limitations to Protect District Water Supply 20 3.3.2 Additional Provisions 21 3.3.3 Enforcement 21 3.3.4 Prohibitions 21 3.3.5 Violations 21 ARTICLE 4. WATER CONSERVATION 21 4.1 Compliance with State Laws 21 4.2 Development and Implementation of Water Conservation Programs. 21 4.2.1 Leak Detection 21 ARTICLE 5. WATER QUALITY 22 5.1 Monitoring Water Quality 22 5.2 Commingling of Water Supplies 22 5.2.1 Standards 22 ARTICLE 6. PROVISIONS FOR WASTEWATER SERVICE 22 6.1 General 22 6.1.1 Policy 22 6.1.2 Service Area 22 6.1.3 Request for Approval from an Existing Service Provider 22 6.1.4 Request for Approval from a New Service Provider 23 6.1.5 Service Area Information 24 6.1.6 Approval Procedures 24 6.1.7 Post-treatment Waters 24 {00096389.DOC v:I) ii 6.1.8 Prohibited Wastes 24 6.1.9 General Prohibition 24 6.1.10 Construction Modifications to Limit Harmful Waste 25 6.1.11 Lateral Size 25 6.1.12 Maintenance of Laterals 25 ARTICLE 7. LIMITATIONS ON DISCHARGE 25 7.1 Limitations On Discharged Wastes/Prohibited Wastes 25 7.1.1 Standards for Water or Wastewater Discharge into the District's Wastewater System 25 7.1.2 Construction Modifications to Limit the Discharge of Harmful Wastes into the District Facilities, Grease Interceptors/Traps and Sand/Oil Interceptors/Traps 26 7.1.3 Review of Plans for the Construction and Installation of Pretreatment Facilities: 26 7.1.4 Sampling Manholes 26 7.1.5 Interceptor/Trap Maintenance: 26 7.1.6 Interceptor/Trap Requirements for Existing Property/District Facilities 26 7.1.7 Construction Modifications to Limit Harmful Wastes, Wash Racks/Floor Slabs 27 ARTICLE 8. PRETREATMENT REQUIREMENTS 27 8.1 General 27 8.1.1 Authority 27 8.1.2 Compliance 27 8.2 Applicability. 28 8.3 Compliance With Requirements 28 8.4 Legal Authority Requirements. 28 8.5 Program Procedure Requirements. 28 8.5.1 Industrial Waste Survey 28 8.6 Extra-Jurisdictional Industrial Users. 28 8.7 Exemptions. 28 8.8 Program Review. 29 8.9 Remedies 29 8.9.1 Emergency Remedies 29 8.9.2 Routine Remedies 29 8.10 Program Preemption. 29 8.11 Program Delegation 29 8.12 District Monitoring. 29 8.13 General Requirements Regarding Deleterious Wastes 30 8.14 Prohibited Discharges 31 8.15 Specific Discharge Limitations— Service Providers. 33 8.16 Applicability. 34 8.17 General Discharge Prohibitions 34 8.18 Specific Discharge Limitations—Users. 34 8.18.1 District Limitations 34 8.18.2 National Categorical Pretreatment Standards 35 {00096389.DOC v:1} 111 8.18.3 State Requirements 35 8.18.4 Dilution Prohibited 35 8.19 Insignificant Discharges. 35 8.20 Accidental Or Unusual Discharges 35 8.20.1 Accidental Discharge Protection 35 8.20.2 Notification Requirements 35 8.20.3 Slug Discharge Plan Requirements 36 8.21 8.21 Hazardous Waste Discharge Notification 36 8.22 Wastewater Contribution Permits 36 8.23 Reporting Requirements For Significant Industrial Users 36 8.24 Monitoring District Facilities. 36 8.25 Information Submittal, Inspection and Sampling 37 8.26 Wastewater Treatment. 37 8.27 Confidential Information. 37 8.28 Remedies For Noncompliance; Enforcement 38 8.28.1 Notice of Violation 38 8.28.2 Administrative Orders 38 8.28.3 Compliance Orders; Compliance Schedules 38 8.28.4 Suspension of Service 39 8.28.5 Permit Revocation 39 8.28.6 Penalties 39 8.28.7 Legal Action 40 8.28.8 Appeal and Hearing Procedure 40 8.29 Charges and Fees. 40 ARTICLE 9. CROSS-CONNECTION CONTROL AND BACKFLOW CONTROL POLICY AND REGULATIONS 40 9.1 General 40 9.1.1 Policy 40 9.1.2 Responsibility 40 9.1.3 Service Provider Requirements 41 9.1.4 Every Service Provider shall adopt policies and regulations for cross- connection control and backflow control sufficient to: 41 ARTICLE 10. MISCELLANEOUS 41 10.1 Liability: 41 10.1.1 District Not Liable 41 10.1.2 District Not Responsible for Damages 42 10.1.3 Officials Not Liable 42 10.1.4 Non-Liability for Work of Others 42 10.1.5 Indemnity 42 10.1.6 Non-Waiver 42 10.1.7 Notices and Written Submissions 42 ARTICLE 11. PROVISIONS REGARDING MOSQUITO CONTROL SERVICES 43 ARTICLE 12. PROVISIONS REGARDING STREET IMPROVEMENTS 43 (00096389.DOC v1) lv ARTICLE 13. PROVISIONS REGARDING EMPLOYEE AND PERSONNEL MATTERS ...43 PRE-CAST CONCRETE INTERCEPTORS 6 MANHOLE RINGS AND COVERS 6 PRE-CAST CONCRETE INTERCEPTORS 12 MANHOLE RINGS AND COVERS 12 (00096389.DOC vJ} V EXHIBITS EXHIBIT A Schedule of Fees, Rates and Charges [Reserved] EXHIBIT B Connector Agreement for Wastewater Service [Reserved] EXHIBIT C Pretreatment Discharge Standard to Limit the Discharge of Harmful Wastes into the District's Facilities EXHIBIT D District Design Standards and Standards and Requirements for Service Providers [Reserved] EXHIBIT E Standards for Cross-Connection Control and Backflow Control Policy and Regulations (00096389.DOC va) Vi ARTICLE 1. GENERAL PROVISIONS 1.1 General. 1.1.1 Authority: These Rules and Regulations are adopted in accordance with the authority conferred in Title 32, Article 1, and other provisions of the Colorado Revised Statutes, by the Resource Colorado Water and Sanitation Metropolitan District Board of Directors. The District is a political subdivision of the State of Colorado and a quasi-municipal corporation with all the powers thereof which are specifically granted to the District, or are necessary or incidental to or implied from powers specifically granted by statute, constitution or other law, for carrying out the objectives and purposes of the District. 1.1.2 Scope: These Rules and Regulations have been adopted and promulgated pursuant to C.R.S. §32-1-1001(1)(m) and shall be considered a comprehensive set of Rules and Regulations governing the operations and functions of the District as of the effective date stated herein. The District has the authority to implement the Rules and Regulations provided herein by policies and resolutions. The Board reserves the right to make rulings and adopt resolutions concerning matters not covered herein as and when appropriate in the opinion of the Board. 1.1.3 Policy.: It is hereby declared that the Rules and Regulations hereinafter set forth will serve a public use and are necessary to insure and protect the health, safety, prosperity, security, and general welfare of the service users of the District. 1.1.4 Purpose: The purpose of these Rules and Regulations is to provide for the orderly financing, control, management and operation of the Water and Wastewater Systems of the District, including additions, extensions and connections thereto, and to provide for the administration and enforcement of standards to promote the health, safety and general welfare of Customers of Service Providers or other service users of the District. Provision of water and sanitation services by the District will be available only in accordance with these Rules and Regulations. 1.1.5 Service Plan Limitations: The District's Service Plan prohibits the District from providing water or wastewater service directly to individual customers without amending the District's Service Plan. The District is empowered by C.R.S. §32-1-1001(1)(d)(I) and by Colorado law to enter into contracts and agreements affecting the affairs of the District. The District intends to enter into Agreements with water and wastewater Service Providers for the provision of water or wastewater services as set forth in these Rules and Regulations. Such Agreements may require Service Providers to satisfy certain other conditions prior to obtaining service from the District. The District's provision of water and/or wastewater services to Service Providers is contingent upon the District having an adequate Water Supply and that the District Facilities are adequate. Because of these limitations, the District cannot guarantee that it will be able to provide water and sanitation service to Service Providers or properties even if they are within the District's Service Area. 1.1.6 Initial Service Area: The initial Service Area consists of underserved areas within Adams and Weld County including the Cities of Brighton or Commerce City or {00096389.DOC v.1) other Service Providers. The District, through Agreements, will supply water or provide wastewater services to Service Providers for service to their Customers through their systems. The Service Area may be expanded to serve other properties, through Agreements with Service Providers, as demand for service and resources to provide such services are available. 1.1.7 Enterprises and Authorities: The provision of water, sanitation and storm drainage services for the use and benefit of Service Providers shall be through the creation of enterprises and/or authorities which will be authorized to collect rates, fees, tolls and charges for connection to and use of the District Facilities and the provision of service. Such service shall be subject to any capacity limitations and provisions for the operation, maintenance, repair and replacement of all District Facilities owned by the District, in accordance with these Rules and Regulations. 1.2 Construction of Rules and Regulations. 1.2.1 Intent of Construction: It is intended that these Rules and Regulations shall be liberally construed to affect the general purposes set forth herein, and that each and every part thereof is separate and distinct from all other parts. No omission or additional material set forth in these Rules and Regulations shall be construed as an alteration, waiver, or deviation from any grant of power, duty or responsibility, limitation or restriction, imposed or conferred upon the Board by virtue of statutes now existing or subsequently amended or adopted, or under any Agreement existing between the District and any other private or governmental entity or Service Provider. Nothing contained herein shall be so construed as to prejudice or affect the right of the District to secure the full benefit and protection of any law which is now enacted or may subsequently be enacted by the Colorado General Assembly pertaining to the governmental or proprietary affairs of the District. 1.2.2 Incorporation of Decrees and Rules and Regulations by Other Governmental Entities: (a) General: Any limitations, restrictions or prohibitions validly placed upon the District or the water rights comprising the District's Water Supply by any governmental entity or by any Agreement to which the District is a party, are hereby incorporated into these Rules and Regulations by this reference and shall constitute a limitation, restriction and/or prohibition on the District's ability to provide service to Service Providers and on each Service Provider that shall contract with the District for the supply of water or wastewater service. (b) Water: The provision of water service by the District may be governed by and subject to court decrees, stipulations, or other court orders or decrees, including any subsequent court orders concerning the water to be supplied through service or delivery agreements by the District to Service Providers. The District acknowledges that water sources also may be limited by all applicable laws, rules and regulations governing the withdrawal of groundwater, including but not limited to, the Ground Water Management Act, §37-90-101 et seq. the Rules and Regulations for the Management and Control of Designated Ground Water, 2 C.C.R. 410-1, and the Regulations for the Use, Control and Conservation of Ground Water (00096389.DOC v:1) 2 Within the Lost Creek Ground Water Management District, laws and regulations governing water quality, and all other applicable laws and regulations, as now or hereafter constituted. 1.2.3 Amendment: It is specifically acknowledged that the District shall retain the power to amend these Rules and Regulations as it deems appropriate and such amendments shall be entered in the Minutes of the District and periodically incorporated in printed copies of these Rules and Regulations. Prior notice of these amendments shall not be required to be provided by the District exercising its amendment powers pursuant to this Article. 1.2.4 Conflict: In the event of a conflict between these Rules and Regulations and specific terms or conditions of any Agreement entered into between the District and any party, these Rules and Regulations shall control. 1.2.5 Severability: If any provision of these Rules and Regulations, or its application to any person or circumstances is held invalid, the application of such provision to other persons or circumstances, and the validity, enforceability or legality of the remainder of these Rules and Regulations, shall not be affected thereby. 1.2.6 Modification, Waiver and Suspension of Rules: The Board of Directors or the District Manager, acting on prior written instructions of the Board, shall have the sole authority to waive, suspend or modify the application of these Rules and Regulations, and any such waiver, suspension or modification must be in writing, signed by the Board or the District Manager and shall not be deemed an amendment of the Rules and Regulations. No waiver, suspension or modification on any one occasion shall constitute a waiver, suspension or modification on any subsequent or other occasion. 1.2.7 Saving Provision: The enactment of these Rules and Regulations, any amendment thereof, or the repeal of any prior existing Rules and Regulations or resolutions shall not deny or limit any right, action, cause of action, penalty charge or fee which arose under such provision. 1.2.8 Repeal of Conflicting Resolutions: All resolutions or parts of resolutions in conflict herewith as of the effective date hereof, are hereby repealed, except as may be expressly provided herein. 1.3 District Facilities. 1.3.1 Ownership and Maintenance of District Facilities: Except as otherwise provided in these Rules and Regulations, it is the policy of the District that all District Facilities forming an integral part of the District's Water and Wastewater Systems are the property of the District upon acceptance by the District regardless of whether such Facilities are constructed, financed, or paid for by the District or by other Persons. The District shall be responsible for maintenance, repair and reconstruction of such Facilities and all appurtenances thereto, at the cost of the District, unless the District Facility is under warranty in which case the warranty provisions shall apply to the fullest extent provided by law. No other Persons, except those authorized by the District, shall have any right to enter upon, inspect, operate, adjust, change, alter, move or relocate any portion of the District Facilities. {00096389.DOC v 1 3 1.3.2 Service Provider System Compliance with Design Standards: [Reserved]. 1.3.3 Encroachment of the District's Easements: No Person, including but not limited to, Service Providers with whom the District has a Contract shall construct any temporary or permanent building or other similar structure, place any fill material on, or otherwise encroach upon any of the District's easements. 1.3.4 Use of District's Easements: A Service Provider, property owner, developer or contractor may request permission from the District to share or use the District's easements for the installation of drains, pipelines or other facilities necessary to utilize the District Facilities. The District's determination to allow a Service Provider, property owner, developer or contractor to share or use the District's easements shall be made in the sole discretion of the District. Any such approval shall be in the form of a written agreement, which shall set forth fully the terms of the agreement, specifically including, but not limited to, the terms set forth below: (a) Any such agreement shall be subject to Board approval after a public meeting therefore. (b) The property owner, developer or contractor shall, at all times, have the obligation, enforceable at the demand of the District, to construct, operate, maintain, repair and replace any non-District owned facilities as may be desirable from time-to-time. (c) The Service Provider, developer or contractor shall agree to indemnify and save the District, its officers, directors, agents and employees harmless from and against every claim, demand, liability, cost, charge, suit,judgment and expense of whatsoever kind or nature, including, but not limited to, interest, court costs and attorneys fees which the District, its officers, directors, agents or employees may pay or incur by reason of or which in any way arise out of the sharing or using of the District's easements by the property owner, developer or contractor. Said indemnification shall extend to claims, demands and liability or injury to persons and property and financial loss which incur off the job site as well as on, and for injury and damage to person and property and financial loss occurring after construction and installation of the non-District owned facilities within the District's easements by the property owner, contractor or developer. 1.3.5 Non-District Water Wells Prohibited: In an effort to coordinate the provision of water services as contemplated in the District's Service Plan, only those wells forming part of the District's Water Supply may connect to the District's Water System. Service Providers that have a Service Agreement with the District shall not act to impair the District's water rights or water quality. The District is not responsible for the augmentation of any wells within the District's Service Area other than those owned by the District, except by separate Agreement. 1.4 Inspections. 1.4.1 Powers and Authority of District: The District Manager or representative or their designee bearing proper credentials and identification shall be permitted to enter all property of the Service Provider necessary for the purposes of reading meters, testing related to {00096389.DOC v:I} 4 discharge(s)to the Water or Wastewater Systems, inspection, observation, measurement, sampling, repair, maintenance of any portion of the District Facilities lying within said properties and related matters, upon reasonable notice to the Service Provider, except in the case of an emergency in which case prior notice is not required. 1.4.2 Construction Inspection: The District Manager, representative or their designee shall have the right to inspect any and all work during construction of any Service Provider facilities necessary to receive water or wastewater service from the District, to ensure installation in accordance with District standards. After completion of construction the District Manager and/or his representative shall make a final inspection of construction prior to commencement of service. 1.5 Protection of District Facilities. 1.5.1 Compliance with Statutes and Regulations: For all projects that require digging, boring, directional drilling or excavation in or around District Facilities, the person, contractor or excavator wishing to dig or excavate around said District Facilities shall comply with all applicable statutes and regulations of the State of Colorado. 1.5.2 Locate Information: For projects that require digging, boring, directional drilling or excavation around District Water System facilities, a contractor or excavator must provide location information to the District and must comply with all other District requirements for notification and processing prior to commencing any digging, boring, directional drilling or excavation. 1.6 Definitions. 1.6.1 Definitions for Water and Wastewater Systems: Unless the context specifically indicates otherwise, the meaning of the terms used herein shall be applicable to these Rules and Regulations. (a) Agreement or Agreements: Any Board approved Water Delivery Agreement, Water Resource Agreement, Connector Agreement and/or any other contract or agreement necessary to the provision of water or wastewater service to Service Providers, together or referred to separately herein. (b) Annual Charges or Annual Charges for Service: The sums paid or becoming payable to the District pursuant to a Connectors Agreement and pursuant to any agreement supplemental thereto. (c) Applicant: The Service Provider entering into a contract with the District for new or additional water or sanitation service. (d) Application Fee: The fee charged by the District that is intended to cover the Costs incurred by the District in evaluating a Water Delivery Agreement or Connector Agreement. {00096389.DOC va} 5 (e) Board or Board of Directors: The duly elected Board of Directors of the District, which acts as the governing body of the District. (f) BOD5 (5-Day Biochemical Oxygen Demand): The quantity of dissolved oxygen, expressed in parts per million by weight, required by aerobic biological action under standard laboratory procedure in five days at 2O C. (g) Capital Improvement Plans: Shall refer to the District's Water or Wastewater Facilities Capital Improvements Plans. (h) Categorical Standards or National Categorical Pretreatment Standards or Pretreatment Standards: Any regulation containing pollutant discharge limits promulgated by the EPA in accordance with Articles 307(b) and (c) of the Clean Water Act (33 U.S.C. §1317 et seq.) which applies to a specific category of Industrial Users. (i) Clean Water Act: The Federal Water Pollution Control Act, as amended, 33 U.S.C. §1251, et seq. (j) Connector Agreement: A contract between the District and a Service Provider for the District to provide wastewater services to a Service Provider in accordance with these Rules and Regulations. (k) Cost(s): All direct costs applicable to the construction, reconstruction, enlargement or dedication of a given District Facility, including but not limited to, costs associated with planning, design, preliminary and design engineering, construction, inspection, administration, acquisition, or dedication of District Facilities, acquisition of all required rights-of-way, acquisition of water rights, depreciation, attorney fees, regulatory agency fees, plan approval fees, "as built" drawings, and all other fees and/or costs necessary to provide new, different or additional water or wastewater service. (1) Customer: Any person, company, corporation, public entity or authority, developer, property owner, lessee, tenant or occupant of such property owner, or visitor of any of the foregoing, who is supplied with or uses water or sanitation service furnished by any Service Provider. (m) Deleterious Wastes: Any wastes contained in sewage that would be harmful to the District's Sewer System, or which, without pretreatment, would violate federal, state or local pretreatment standards. (n) Design and Construction Standards and Specifications for Water and Wastewater Facilities ("Design Standards"): District document that establishes the minimum standards for the design and construction of all Facilities of the District. (o) District: The Resource Colorado Water and Sanitation Metropolitan District, a quasi-municipal corporation and political subdivision of the State of Colorado. (00096389.DOC v:l} 6 (p) District Engineer: The person or firm appointed by the Board and employed by or contracted with to do engineering work for the District. (q) District Facility or Facilities: All components of the District's Water and Wastewater Systems however acquired by the District and constructed. The District Facilities shall also include all land, easements, permits or other interests in real property, and all operational permits and licenses and all roadways or access facilities and all improvements necessary to the operation of the District Facilities and to carry out the purposes of the District. (r) District Manager: The person or firm retained by the Board to administer and supervise the affairs of the District and its employees, including, but not limited to, enforcement of the District's Rules and Regulations, and who may, among other things, operate, inspect and approve all connections, excavations, extensions, installations, District Facilities owned, to be dedicated to, or under the control of the District. (s) District Water Supply: All non-potable water, potable water, first use or reuse water, return flows, banked water credits, banked return flow credits, tributary, not non-tributary, non-tributary and designated basin water rights and groundwater rights owned by or which is made available by dedication, lease, contract or Agreement to the District for provision of service to Service Providers pursuant to the terms of an Agreement. (t) ERU (Equivalent Residential Unit): An approximate measure of the level of service necessary to serve a single-family dwelling, which is used to calculate the cost of connection fees and service charges pursuant to an Agreement. (u) Extension: A water transmission main or wastewater interceptor sewer required in order for the District to provide service to Service Providers according to the terms and conditions set forth herein. (v) Extension Agreement: An Agreement executed by the District and a Service Provider providing for the installation of an extension by the District pursuant to which the cost of such extension is paid by the Service District to the District. (w) Inspector: The person, persons or firm duly authorized by the Board to inspect, monitor and approve the installation, connection, and operation of the District Facilities and to periodically monitor and inspect the operations of such District Facilities. (x) Industrial User: Any non-domestic source discharging pollutants into the District's Wastewater Facilities. (y) Industrial Wastes: The liquid wastes from industrial processes, trade or business, as distinct from sanitary sewage. (z) Interceptor: Any one of the intercepting sewers, outfalls, or force mains that is part of the Wastewater Collection System. (aa) Interference: A discharge which, alone or in conjunction with a discharge or discharges from other sources, both: {00096389.DOC v.1) 7 1) Inhibits or disrupts the District's treatment processes or operations, or its sludge processes, use or disposal; and 2) Therefore is a cause of a violation of any requirement of the District's NPDES Permit(s) (including an increase in the magnitude or duration of a violation) or of the prevention of sewage sludge use or disposal in compliance with the following statutory provisions and regulations or permits issued thereunder (or more stringent state or local regulations): Article 405 of the Clean Water Act, the Solid Waste Disposal Act (SWDA) (including Title II, more commonly referred to as the Resource Conservation and Recovery Act (RCRA), and including state regulations contained in any state sludge management plan prepared pursuant to Subtitle D of the SWDA), the Clean Air Act, the Toxic Substances Control Act, and the Marine Protection, Research, and Sanctuaries Act. (bb) Main Line: Water or sewer pipe used for the purpose of conveying water to a Water Connection Point or conveying Wastewater from a Wastewater Connection Point that is part of the District Facilities. (cc) Master Water Meter: Measuring device used to determine the amount of water supplied to a Service Provider at a Water Connection Point. (dd) MG: Million gallons. (ee) National Pollutant Discharge Elimination System or NPDES Permit: A permit issued pursuant to Article 402 of the Clean Water Act (33 U.S.C. 1342). (ff) Permit: Written permission of the Board given pursuant to these Rules and Regulations, subject to the specific terms and conditions contained therein. (gg) Person: Any individual, partnership, co-partnership, firm, company, corporation, association, unincorporated association,joint stock company, trust, estate, governmental entity, or any other legal entity, or their legal representatives, agents or assigns, or two or more such persons acting jointly as a firm, partnership, unincorporated association,joint adventurers or otherwise. (hh) pH: The logarithm (base 10) of the reciprocal of the concentration of hydrogen ions expressed in moles per liter of solution. (ii) Pollutant: Any dredged spoil, solid waste, incinerator residue, sewage, garbage, sewage sludge, munitions, chemical wastes, biological materials, radioactive materials, heat, wrecked or discharged equipment, rock, sand, cellar dirt, and industrial, municipal, and agricultural waste discharged into water. Pollution - Hazard Activity: Means any of the following activities: 1) Drilling operations. 2) Surface and subsurface mining operations. {00096389.DOC v:1} 8 3) The storage and application of pesticides/herbicides and/or insecticides in any manner, except for private residential or business use. 4) The storage and application of fertilizers in any manner, except for private residential or business use. 5) Using, handling, storing, dispensing or transporting toxic or hazardous substances, including, but not limited to radioactive materials. 6) Using, handling, storing, dispensing or transporting flammable or explosive materials, including petroleum products, except for storage of not more than 25 gallons of petroleum products in a private home or business and except for fuel in vehicular fuel tanks. 7) Using, handling, storing, dispensing or transporting organic nutrients, including phosphorus and nitrates, or engaging in any activity that creates the same. 8) Any solid or liquid waste disposal. 9) Any activity that is conducted in a manner that creates a foreseeable risk of pollution to the District Water Supply or damage to the District's Facilities. (kk) Pretreatment or Treatment: The reduction of the amount of Pollutants, the elimination of Pollutants, or the alteration of the nature of Pollutant properties in wastewater to a less harmful state prior to or in lieu of discharging or otherwise introducing such Pollutants into a POTW. The reduction or alteration can be obtained by physical, chemical, or biological processes, or by other means, except as prohibited by 40 CFR §403.6(d). (11) Pretreatment Facilities: Structures, devices, equipment or processes for the purpose of reducing or removing the deleterious wastes from Wastewater or altering the nature of deleterious wastes prior to discharging such sewage into the District's Wastewater Collection System. (mm) Pretreatment Requirement: Any substantive or procedural requirement related to pretreatment, other than a National Pre-treatment Standard imposed on an Industrial User. (nn) Properly Shredded Garbage: Garbage that has been shredded to such a degree that all particles will be carried freely under the flow conditions normally prevailing in public sewers with no particle greater than 1/2" in any dimension. (oo) Property Owner or Owner: The person or persons who hold title to a parcel of land as shown on the property tax assessment roll in the office of the applicable County Assessor. (pp) Publicly Owned Treatment Works ("POTW"): A treatment work as defined by Article 212 of the Clean Water Act (33 U.S.C. §1292), which is owned in this instance by the District. This definition includes any devices and systems used in the storage, (00096389.DOC v } 9 treatment, recycling and reclamation of Sewage or industrial wastes of a liquid nature. It also includes sewers, pipes and other conveyances only if they convey wastewater to the POTW treatment plant. "POTW" also refers to the District officials responsible for operations and maintenance of the collection system or treatment plant and the administration of the pretreatment program. (qq) SDWA: The Safe Drinking Water Act of 1974, as amended, 42 U.S.C. §300 j -9(i). (n) Service Area: A planning term, which refers to all areas currently being served or proposed or planned to be served pursuant to the District's Service Plan approved on August 25, 2004 by the County Commissioners of Weld County, Colorado, as amended from time to time. However, any reference to the District Service Area or proposed Service Area does not mean that the District is capable or that property within the Service Area is entitled to service. (ss) Service Provider(s): Municipalities, counties, authorities, special districts (including Metropolitan Districts and Water and Sanitation Districts), water companies and ditch companies, as well as state and local entities who will contract with the District for water and/or wastewater services and for the provision of wastewater service, and may also include private entities, and who will in turn distribute the water, collect Sewage and otherwise service and bill the individual Customers, including residential, commercial, and/or Industrial Users. (tt) Sewage or Wastewater: A combination of liquid wastes originating from any residential, commercial, or industrial building or other establishment, which may include household wastes, human excreta, animal or vegetable matter, organic or inorganic material in suspension or solution, and other solids in suspension or solution which enter the POTW. (uu) Sewer or Wastewater Main Line: Any pipe, system of piping and appurtenances used as a conduit for Sewage in the District's Wastewater Collection System and owned by the District. (vv) Sewer or Wastewater Service Line: Any pipe, system of piping, tap, line and appurtenances including lift stations, pumping stations and collection lines, used as a conduit for Sewage from the Wastewater Connection Point to the District's POTW. (ww) Significant Industrial User: 1) Any Industrial User subject to categorical pretreatment standards under 40 CFR §403.6 and 40 CFR Chapter 1, Subchapter N; 2) Any Industrial User designated as such by the District on the basis that the Industrial User has a reasonable potential for adversely affecting District operations or for violating any pretreatment standards or requirement; {00096389.DOC v ) 10 3) Any Industrial User discharging an average 25,000 gallons per day or more of process wastewater to the sanitary sewer system (excluding sanitary, non- contact cooling, and boiler blow down wastewater); and 4) Any Industrial User discharging a process waste stream which makes up five percent (5%) or more of the average dry weather hydraulic or organic capacity of the District's Wastewater Treatment Works. Upon a finding that an Industrial User meeting the criteria in paragraphs (b), (c), or (d) above has no reasonably potential for adversely affecting the District's operation or for violating any Pretreatment Standard or requirement, the District may at any time, on its own initiative or in response to a petition received from a Service Provider or Industrial User, determine that such Industrial User is not a Significant Industrial User. (xx) Slug Discharge: Any discharge of a non-routine, episodic nature, including but not limited to an accidental spill or a non-customary batch discharge. (yy) Suspended Solids: Solids, expressed in parts per million by weight, that either float on the surface of or are in suspension in the water, sewage or other liquids, which are removable by filtration. (zz) Testing: In the context of water or sewage, the analysis of water or sewage samples for composition, and other characteristics; in the context of construction or connection of Water or Wastewater System facilities, the inspection and trial operation of the construction or connection of Water or Wastewater System facilities. (aaa) Total Kjeldahl Nitrogen (TICN): The sum, expressed in parts per million (ppm) or milligrams per liter(mg/L), of free-ammonia nitrogen and organic nitrogen compounds which are converted to ammonia under digestion conditions specified by the Kjeldahl Nitrogen Test Method. (bbb) Toxic Pollutant: But not limited to, any pollutant or combination of pollutants listed as toxic in regulations promulgated by the administrator of the Environmental Protection Agency under the provisions of Article 3O7(a) of the Clean Water Act or other acts. (ccc) Upset: An exceptional incident in which there is unintentional and temporary noncompliance with permit effluent limitations because of factors beyond the reasonable control of the District which result in flows or solid materials exiting the District's Wastewater System into state waters and which may cause or threaten pollution of state waters. (ddd) Wastewater Collection System: All structures, facilities, and equipment owned and used by the District for collecting, pumping and transporting Wastewater within the District's Wastewater System from the Wastewater Connection Point to the District's Wastewater Treatment Works, including but not limited to metering facilities, Interceptor sewers, manholes and lift stations. {00096389.DOC v:l} 11 (eee) Wastewater Connection Point: The point at which the Service Provider's sewer service lines or system connects to the District's Wastewater System for a permanent or temporary purpose. (fff) Wastewater System: All components of the District's Wastewater Collection System and Wastewater Treatment Works. (ggg) Wastewater Treatment Works: All structures, facilities, and equipment owned and used by the District for treating Wastewater prior to discharge or disposal, including but not limited to the headworks facilities, treatment basins, disinfection processes and effluent outfall, as well as solids handling facilities. (hhh) Water Connection Point: The point at which the Service Provider's water service system connects to the District Water System for a permanent or temporary purpose. (iii) Water Delivery Agreement: A contract for the delivery of all or a portion of the District's Water through the District's Water Distribution System to the Service Provider and may establish other contractual obligations as conditions for the provision of water service to the Service Provider for delivery by the Service Provider to its Customers. (jjj) Water Distribution System: All structures, facilities and equipment owned and used by the District for storing, boosting, transporting to the Water Connection Point, and measuring the District's Water Supply, including but not limited to tanks, booster pump stations, distribution piping and metering facilities. (kkk) Water Lease: An agreement with a Service Provider to lease District water or water rights subject to limitations for delivery of water so as not to impair existing Water Delivery Agreements and terms sufficient to secure payment for the Costs of delivering such water. (111) Water Resources Agreement: Agreement between an owner of a water right and a Service Provider seeking to acquire water service from the District, which provides the Service Provider with water resources to serve all or a portion of the property within the Service Provider's service area and may establish other contractual obligations as conditions on the provision of water to the Service Provider by the District, including but not limited to, assurances regarding water quality and availability of substitute supplies. (mmm)Water System: All components of the District's Water Treatment System and Water Distribution System. (ram) Water Treatment System: All structures, facilities, equipment and processes owned and used by the District for diverting, producing, transporting and treating the District's Water Supply including but not limited to wells, gathering, piping and treatment facilities. (00096389DOC v:I} 12 Any Other Term: Any other term not herein defined shall be defined as presented in the "Glossary - Water and Sewage Control Engineering," A.P.H.A., A.W.W.A., A.S.C.E., and F.W.S.A., latest editions. ARTICLE 2. REQUIREMENTS FOR ACQUIRING WATER OR WASTEWATER SERVICE FROM THE DISTRICT 2.1 Water or Wastewater Service. 2.1.1 Policy.: Provision of water or wastewater service by the District to Service Providers is subject to these Rules and Regulations. Service Providers seeking to acquire water service from the District shall enter into a Water Delivery Agreement with the District whereby the Service Provider's water supply or water resources necessary for meeting the Service Provider's needs shall be made available to the District. For Wastewater Service, Service Providers shall be required to enter into a Connector Agreement. The District may require certain additional conditions prior to granting of service from the District. 2.1.2 No Obligation of Service: Pursuant to C.R.S. §32-1-1001(1)(d)(I), the District may enter into contracts and agreements affecting the District's water or wastewater service and the District's ability to provide such service. The District is not obligated to provide public water or wastewater service other than as required by existing express written Agreements. Subject to the limitations and conditions herein and in any Agreement, it is the intent of the District to make available water or wastewater service to those Service Providers that contract with the District. The relationship between the District and Service Providers receiving water and wastewater service from the District Facilities shall be contractual. 2.1.3 Revocation of Service: Service shall be revocable by the District upon non-payment of fees or charges owed to the District, upon failure to comply with the District's Rules and Regulations, or when the District Manager or Board determines that an emergency exists and such revocation is necessary to protect the health, safety and welfare of the Service Provider Customers. (a) Notice and Hearing: In all cases except as specifically provided otherwise herein, or except in those circumstances involving an imminent hazard to the health, safety or welfare of Service Providers, their Customers or to the District's Water and Wastewater Systems, the District may make provisions for notice and hearing prior to revocation of service. 2.1.4 Covenants: Some conditions of Agreements between the District and Service Providers or other Users seeking service may require Service Providers to enter into commitments concerning real property. Such commitments shall be recorded and shall constitute covenants that run with the property. 2.1.5 Contracts and Agreements: (a) As provided in Article 2.1.2 of this Article 2, the District shall provide water or wastewater service to Service Providers only by Agreement. However, the )00096389.DOC v:1) 13 District may in its discretion determine on a case-by-case basis the appropriate terms of such Agreement(s), including but not limited to the nature of the water to be delivered, terms that meet special circumstances such as bulk delivery agreements, or provisions accommodating special circumstances for wastewater service. (b) Each Agreement is subject to these operating Rules and Regulations, District engineering standards, and all rules and policies promulgated hereunder and amendments thereto. The operating rules and engineering standards and any amendments shall be incorporated by reference and made a part of any Agreements with Service Providers by reference to these Rules and Regulations. 2.1.6 Denial of Service: The District's Board retains, in its sole discretion and judgment, the right to deny an application for service when granting the application for service would not be in the best interests of the District. The District may deny any application for water or wastewater service to any property within the District's Service Area or wastewater service area as defined in Section 6.1.2, based on the District's determination that the District lacks sufficient water treatment capacity, wastewater treatment capacity, water and/or wastewater Facilities and/or water resources to serve the properties proposed by any Service Provider making application to the District for water or wastewater service. Other factors that the District's Board may consider, not by way of limitation, include each of the following: (a) Whether adequate water resources, water rights, water storage and related water facilities are available and will be available in the future to serve existing or proposed Service Providers and the impact of other factors resulting in the unavailability of water supply, including restrictions that may be imposed by the State Engineer or other applicable agency. (b) The impact of the requested service on the District's existing water or wastewater service, treatment, transmission and storage facilities and capacity limitations related to water and wastewater treatment. (c) The economic effect that the approval of the application for service would have on the District. (d) Whether granting the application for service would adversely affect the public health, welfare or safety of the residents and property owners served by the District's existing or future Service Provider customers pursuant to Agreements. (e) Any other factors related to the application for service. There may be factors and aspects of an application for service that are unique to that application and are not contained in the above list, and the Board retains the right to consider any and all factors related to an application for service and to make a decision based thereon. 2.1.7 Application for System Review: A Service Provider seeking to acquire water service from the District shall submit an application for system review, which is the District's review process designed to ensure that the District has adequate resources, to assess District Facility needs, and determine whether Service Provider's water or wastewater facilities proposed to be connected to the District's Water or Wastewater Systems comply with the (00096389.DOC v } 14 District's Design Standards. The District's review will determine the scope of additional District water or wastewater Facilities required to serve the Service Provider. 2.1.8 Other Conditions for Service: In addition to the requirements for service set forth in this Article 2, the District may require that a Service Provider seeking to acquire service from the District satisfy certain conditions, as outlined in this section and as set forth more specifically in other sections of these Rules and Regulations. (a) Integrated System: The District may condition service upon the Service Provider being part of a viable integrated system for the installation, operation and maintenance of water delivery and wastewater systems. The District may adopt operating rules and engineering standards establishing the minimum service requirements, but the District and any Service Providers acknowledge that those requirements may be further limited or restricted by individual Service Provider's rules, regulations or standards. (b) The District may require that all property served or to be served by the District be within the Service Provider boundaries or be included within the Service Provider boundaries or meet other service area requirements for wastewater service as set forth in Article 6 herein, , prior to execution of an Agreement to insure the orderly, efficient, and economically feasible delivery of service. (c) Adequate Water Resources: A Service Provider seeking to acquire water or wastewater service from the District may be required to dedicate reuse or return flow water rights to the District. (d) Adequate Water or Wastewater Systems: The District may require, as a condition of service, advance dedication of fees or capital to build necessary water or wastewater Facilities, and may provide for such fees or capital in an Agreement between the District and the Service Provider, for which the District may, but it is not required to, provide credit to the Service Provider. The District also may require payment of additional fees for the purpose of meeting costs of expanding District Facilities, such fees to be determined by the Board from time to time. (e) Adequate Main Lines and Service Lines: A Service Provider seeking to acquire water or wastewater service from the District shall be required to pay for the District's construction Costs of all Facility extensions necessary to connect the Service Provider's system to the Water and/or Wastewater Systems of the District. (0 Non-Potable Irrigation System: In certain areas of the District a Service Provider seeking to acquire water or wastewater service from the District may be required to pay for the construction of a separate non-potable irrigation system for the Customers of the Service Provider's service area. (g) Well Site Dedication: In order to provide water and/or wastewater service to property within the Service Provider's boundaries or service area, the District may require the dedication of easement(s), easement(s) for well site(s) together with access easement(s), water, sewer and electrical line easement(s) or fee simple property at no cost to the District. The dedication of such easement(s), well site(s) and/or fee simple property shall be in 100096389.DOC v:1) 15 addition to the dedication of water rights that may be required under a Water Delivery Agreement and any other requirements of these Rules and Regulations, and shall be free and clear of all liens and encumbrances prior to approval of service to the Service Provider. (h) Dedication of Groundwater Rights: As a condition of a service, the District may require that the Service Provider dedicate to the District sufficient tributary, not nontributary, nontributary and designated basin water rights and groundwater rights necessary to supply water sufficient to service the Service Provider's Customers. Such dedication shall include the irrevocable consent to the use by the District, as a part of the District Water Supply, of all of the groundwater rights, which use includes without limitation the exclusive right to take, appropriate, produce, use and otherwise dispose of said water. The District has the sole discretion to determine the adequacy and sufficiency of the dedication of such ground water rights, and to determine whether, in the judgment of the District's Board, the groundwater rights are compatible with the District's Facilities and the needs and infrastructure of the Service Provider. The District may further require that the Service Provider consent to being served with such groundwater through the District's Water System, wherein such water may be commingled with the District Water Supply for the purposes of being furnished by the District, and that the Service Provider consent to the continuing jurisdiction of the Water Court or other agency with respect to such water rights, such groundwater rights be conveyed to the District free and clear of all liens and encumbrances prior to approval of service to the Service Provider. (i) Dedication of Water Rights: Sufficient water rights, water storage or related facilities or the equivalent thereof sufficient to provide water service to the Service Provider may be required to be dedicated to the District as a condition of service. The District has sole discretion to determine the adequacy and sufficiency of the dedication of such water rights, water storage or related facilities, and to determine whether, in the judgment of the District's Board, the water rights, water storage or related facilities are compatible with the District's Facilities and the Service Provider's infrastructure and service needs. Such water rights, water storage or related facilities or monies shall be conveyed to the District free and clear of all liens and encumbrances prior to approval of service to the Service Provider. (j) Water Resources Fee: In the sole discretion of the Board, the Service Provider may satisfy all or part of the water resources, groundwater and/or well site dedication requirements stated above through monetary compensation, defined as a water resources fee, adequate to purchase or compensate the District for the water rights, groundwater rights, water storage or related water facilities required to provide such service to the Service Provider. The District may adopt policies from time to time, by Board resolution, regarding such determinations. (k) Reimbursement for Agreement Processing: The District may require in the application process, that on completion of the Board's approval or denial of a proposed Agreement the District may determine the actual cost expended by the District in considering any Agreement and require reimbursement by the Service Provider. 2.1.9 District. Responsibility for Costs of Providing Service within Service Provider's System: A Service Provider seeking to acquire water or wastewater service from the District shall be responsible for the design costs, construction costs, installation costs, and any (00096389.DOC v ) 16 other costs and/or fees and charges associated with provision of water or wastewater service through the Service Provider's system from the Water or Wastewater Connection Point(s) to the Service Provider's Customers, except as otherwise provided pursuant to separate Agreement with the District. 2.1.10 Procedural Requirements for Acquiring Water or Wastewater Service: (a) Application: A Service Provider seeking service from the District shall submit an application on an approved District form. Any Agreement may contain any conditions, not contrary to law, for the provision of service. (b) Other Procedural Requirements: [Reserved]. 2.2 Fees, Rates and Service Charges. 2.2.1 Policy. Except as provided in any Agreement, all Costs of new construction, reconstruction, repair, replacement or enlargement of the District Facilities which are necessary to provide new, different or additional water or wastewater services within the District's Service Area shall be the responsibility of Service Provider and incorporated into the District's rate structure to insure the sustainability of water quality and quantity and the adequacy of water and wastewater service to Service Providers. Service Providers seeking to acquire water or wastewater service from the District, or seeking changes to existing service, shall have in place a structure for levying and collection of all applicable fees, rates and service charges, which shall be subject to review of the District prior to entering into an Agreement by the District. The provisions of these Rules and Regulations apply regardless of whether the District or some other person contracts for, or initially pays for, such construction, reconstruction or enlargement of the District Facilities. The District Board may act other than as required in this section when it determines, in its sole discretion, that such action is in the best interests of the District, or is necessary to provide for the health, safety and welfare of the inhabitants and visitors of the Service Providers contracting for service with the District. 2.2.2 Payment of Fees: Subject to the terms of individual Agreements with the District, all fees due to the District shall be paid prior to connection to District Facilities and provision of service. 2.2.3 Schedule and Types of Fees, Rates and Service Charges: (a) Schedule of Fees, Rates and Service Charges: The District's fees, rates and service charges shall be as set forth in Exhibit A hereto [Reserved]. (b) System Development Charges: Except as provided in an Agreement, Service Providers shall pay system development charges and/or plant investment fees for service by the District. Such charges and fees shall be for all Costs associated with construction, development, reconstruction or expansion of all District Facilities, including but not limited to diversion structures, wells, pipelines, pumps, lift stations, storage facilities, collection or gathering pipelines, and all water or wastewater treatment facilities, and all other temporary or permanent structures necessary for the development of the District's Water or Wastewater Systems, as applicable, depreciation, and repair and replacement costs and reserves, (00096389.DOC v:l} 17 pursuant to an allocation formula determined by the Board. System development charges or plant investment fees also may include but not be limited to, water resources fees as defined in Section 2.1.8(j), all Costs associated with acquisition of land, water resources, wells or diversion structures, easements, rights of way or permits necessary for the diversion, withdrawal, delivery, treatment, substitution of supply, or storage of the District's Water Supply or provision of water or wastewater service by the District. System development or plant investment fees shall be assessed as provided for in Exhibit A [Reserved]. System development or plant investment fees shall be non-refundable. (c) Connection Fees: Connection fees shall be charged to all Service Providers and shall be due and payable when application is made to the District for new or additional water or wastewater service and prior to the installation of a water or wastewater connection or as otherwise provided in an Agreement. Connection fees can be prepaid. Connection fees shall be calculated to recover all District expenses and costs associated with providing water or wastewater service to a Service Provider or other User as defined in Section 8.16(a). Connection fees may consist of different components such as: connection charge, development plan review fee, water resource development charge, and Master Meter charge. Water and wastewater connection fees shall be assessed as provided for in Exhibit A [Reserved]. Connection fees shall be non-refundable. (d) Service Charges: 1) Policy for Calculation and Payment of Service Charges: Customers' service charges shall be paid by all Service Providers based on rates and charges set by the District pursuant to rate studies and after public hearing. Rates and procedures for payment of service charges to the District shall be as set forth in Agreements or these Rules and Regulations. It shall be the policy of the District to implement procedures for the timely and regular payment of service charges to the District. 2) Amended Service Charges: Agreements shall provide in those situations where, in the Board's sole discretion, the service charges do not represent fair, reasonable and equitable charges for the intended use, the Board may adjust the charges. 3) Payment of Service Charges: Billing cycles for statements for service charges to be paid to the District shall be as determined by the Board or pursuant to an Agreement approved by the Board. Charges for late payments, turn-on, turn-off, or other penalties, shall be added to such statements. Service charges shall be assessed as provided for in Exhibit A [Reserved]. Service charges or fees shall be non-refundable. 2.2.4 Billing Procedures for Service Charges : [Reserved]. (00096389.DOC v:1) 18 ARTICLE 3. WATER SERVICE 3.1 Principles for Supplying Water Resources to Public Water Service Providers. 3.1.1 Policy Regarding Use of District Water System: Use of the District's Water System shall comply with these Rules and Regulations. The right to use the Water System is only by permission granted by the District through a Water Delivery Agreement or other Agreement. The District reserves the right to determine all matters related to the control and use of its Water System. The right to use of the Water System shall be subject to suspension, disconnection or revocation as set forth in these Rules and Regulations or in any Agreement with a Service Provider. 3.1.2 Water Policy: It is the policy of the District to provide Service Providers with single use water unless specified otherwise by Agreement. 3.1.3 Scope of District Water Supply: In order to provide for an integrated Water System as contemplated, the District may acquire water supplies by contractual agreements, purchase contracts, leases or other Agreements. The District Water Supply shall consist of all legally available water, including, but not limited to, supplies of non-potable water, potable water, first use or reuse water, tributary, not non-tributary, non-tributary and designated basin water rights and groundwater rights, return flows, banked return flow credits, or other legally available water supplies together with all well structures, diversion structures, easements, delivery systems, measuring devices and all other appurtenances thereto. All rights to water held, owned or controlled by the District pursuant to any Agreement or conveyance, may be incorporated into the District's Water Supply and shall be available for delivery to Service Providers pursuant to a Water Delivery Agreement. 3.1.4 Ownership of Water and Return Flows: To the extent the District has dominion or control,pursuant to an Agreement or otherwise, of water supplies as part of the District Water Supply, the District shall have sole dominion, control, right and use of all water supplied through the Water System, subject to reasonable use thereof by Service Providers or their Customers in compliance with applicable Water Delivery Agreements and/or these Rules and Regulations. Such dominion and control shall continue without interruption as to all wastewater, return flows, runoff, sewage or tailwater attributable to or originating in water supplied through the Water System, pursuant to any applicable court decrees or regulatory restrictions. The District shall have the exclusive right to recapture such return flows or claim credit therefrom for exchange, replacement, augmentation, substitute supply or any other lawful purpose, and the District's dominion and control over the District's Water Supply shall continue to attach to all such return flows even after they return to the ground. All such return flows from water supplied through the Water System remain the property of the District. The District retains the sole authority to determine the yield of all water, water rights and augmentation plans which are offered to the District for any purpose. 3.1.5 Consent to Groundwater Appropriation: The owners of all land, their heirs, successors and/or assigns which overlies the groundwater comprising all or a portion of the District's Water Supply shall be deemed to have consented to the withdrawal by the District of {00096389.DOC v ) 19 all such groundwater unless consent shall be deemed to have been withheld as otherwise provided by law upon the effective date of these Rules and Regulations. 3.2 District Water System and Service Provider Systems. 3.2.1 Ownership and Maintenance of Service Provider Water Service Facilities and Lines. (a) Each Service Provider's water service system, commencing from the Connection Point on the District's main water supply line for a Service Provider and continuing through the Service Provider's system, are the property and responsibility of the Service Provider to design, monitor, operate, regulate and maintain as determined by the rules and regulations for the Service Provider. All other water service lines, curb boxes, valve boxes and meter pits, or other improvements necessary for the Service Provider to supply water to its Customers are the property and maintenance responsibility of the Service Provider or Service Provider Customer(s) as determined by the rules and regulations for the Service Provider. (b) Leaks or breaks occurring at Connection Points to the District's Water Distribution System shall be repaired by the Service Provider within seventy-two (72) hours after discovery of such condition by the Service Provider or notification of such condition to the Service Provider by the District. If satisfactory progress toward repairing any leak or break has not been accomplished within such time period, the District shall take actions necessary to make all required repairs at the full expense of the Service Provider. The District reserves the right to make the repair at the expense of the Service Provider when, in the opinion of the District, such repair is necessary to protect the operation of the District's Water System or for the protection of the health, safety and welfare of the inhabitants and visitors of the Service Providers served by the District. 3.2.2 Ownership and Maintenance of Master Water Meters and Related District Facilities: (a) It shall be the duty of all Service Providers to notify the District if a Master Water Meter and/or related facilities at any Connection Point are operating defectively within twenty-four(24) hours of discovery of such condition. It shall also be the duty of all Service Providers to maintain free and clear access to the Master Water Meter and all component parts making up the Master Water Meter assembly. (b) The District shall be responsible for the maintenance and repair of all Master Water Meters unless it determines that said meter has been willfully damaged, in which case the District shall have the Master Water Meter repaired or replaced and shall charge the Service Provider therefore. 3.2.3 Non-Potable Irrigation System: [Reserved]. 3.3 Protection of District Water Supply.Limitations to Protect District Water Supply: In order to protect the District's water supply from pollution and from activities that create a hazard to health and water quality and to protect the health, safety and welfare of the Service Providers and/or their Customers or to District's residents, the District will not provide service to {00096389.DOC v.1) 20 property that is used for a Pollution - Hazard Activity if the location of said property poses an unreasonable risk of contamination that could cause pollution to the District's Water Supply such that the District would not have adequate time following a release of contaminants to protect or provide for a substitute water supply. Such determinations shall be made in the sole discretion of the District. The District shall take all steps necessary in its discretion including contracts with Service Providers to protect the District Water Supply. 3.3.2 Additional Provisions: [Reserved] 3.3.3 Enforcement: [Reserved] 3.3.4 Prohibitions: [Reserved] 3.3.5 Violations: [Reserved] ARTICLE 4. WATER CONSERVATION 4.1 Compliance with State Laws: The District shall implement all measures required by law for water conservation with respect to the operation of the District Water System. 4.2 Development and Implementation of Water Conservation Programs. 4.2.1 Leak Detection: The District's objectives in implementing a leak detection program include assessment of the impact of unaccounted-for water use and Water System loss estimates on the District's Water Supply, and identification and repair of leaks within the Water System to maintain a low and acceptable amount of unaccounted-for water use. The goal is to reduce Water System losses. (a) The District will conduct a water audit to determine the amount of water unaccounted-for or lost in the District Water System. The audit shall include recording information on the Water System, estimating leaks, estimating leak losses, estimating revenue losses from leaks, and estimating costs for repairs. (b) If unaccounted-for water losses from leaks are determined to be ten percent (10%) or more of total consumption, the District shall develop and implement a leak detection program. The program will traverse all of the Water Distribution System that has pipe over twenty (20) years old on a five-year basis to locate and repair leaks. All identified leaks, including leaks in Master Meters and valves, shall be repaired within seventy-two (72) hours. {00096389.DOC va) 21 ARTICLE 5. WATER QUALITY 5.1 Monitoring Water Quality. Unless provided otherwise in Water Delivery Agreements or other Agreements, Service Providers shall be solely responsible for meeting all applicable regulations for drinking water or other water quality standards from the Connection Point for delivery through the Service Provider's system to its Customers, including all sampling, monitoring, reporting, notice and compliance standards, regulations and requirements. 5.2 Commingling of Water Supplies. The District may commingle water from its various Water Supply sources provided that delivery requirements are met to Service Providers. 5.2.1 Standards: The District may require that water resources acquired for its Water Supply System meet certain minimum constituent standards for groundwater or other applicable standards and regulations. ARTICLE 6. PROVISIONS FOR WASTEWATER SERVICE 6.1 General. 6.1.1 Policy. Use of and all discharges of wastewater into the District's Wastewater System shall comply with these Rules and Regulations. The right to any use of the Wastewater System is only by permission granted by the District through a Connector Agreement. The District reserves the right to determine all matters related to the control and use of its Wastewater System. The right to use of the District's Wastewater System shall be subject to suspension, disconnection or revocation as set forth in these Rules and Regulations or in a Connector Agreement with a Service Provider. 6.1.2 Service Area: As provided in a Connector Agreement, the form of which is attached hereto as Exhibit B, a Service Provider may only provide wastewater service within its approved service area. The District's wastewater service area is as defined by the local water quality planning agency. This Article describes the procedures for Service Providers requesting approval of an expanded or new wastewater service area. The sewer service area for the District shall only include the area approved by the local water quality planning agency and will only be expanded in accordance with the local water quality planning agency's amendment process. 6.1.3 Request for Approval from an Existing Service Provider: When an existing Service Provider wishes to provide wastewater service to any area outside the service area previously approved by the District, the existing Service Provider shall submit a request in writing to the District . The request shall include, at least, the following: (a) A map of the area showing the boundaries of the enlarged area and showing the existing and the proposed major sewers which will serve the area. The map shall show which existing connection point(s) will serve the additional area and if a new connection point(s) will be required. (00096389.DOC v } 22 (b) Information on the projected land use, zoning, residential densities, and commercial/industrial nature of the area. (c) The 10-year, 20-year and ultimate population projections of the enlarged area and the corresponding estimated average and peak quantity of flow expressed in million gallons per day (MGD). The flow data shall be in the form of a flow versus time curve projected to the ultimate development of the area. (d) The 10-year, 20-year and ultimate estimated quality of flow expressed in biochemical oxygen demand (BOD) and suspended solids (SS), plus any additional pertinent information regarding the quality of flow expected, particularly from industrial sources. (e) A letter from all existing sanitation districts or other sewer service entities overlapping or within five miles of the enlarged area stating the feasibility of providing service to the enlarged service area and the justification for not connecting to other existing facilities where feasible. (f) Institutional arrangements such as contracts and/or covenant terms for all users within the expanded service area to insure proper operation and maintenance of the connector's wastewater collection system. (g) Management capabilities, including user contracts, operating agreements, pretreatment requirements, etc., for controlling the wastewater collection system on a continuous long-term basis. 6.1.4 Request for Approval from a New Service Provider: When a new Service Provider wishes to provide wastewater service to any area outside areas previously approved by the District or outside the approved service area of the District, the new Service Provider shall submit a request in writing to the District. The request shall include, at least, the following: (a) A map of the area showing the boundaries of the proposed area and showing the existing and the proposed major sewers which will serve the area. The map shall show which existing connection point(s) will serve the proposed area and if a new connection point(s) will be required. (b) Information on the projected land use, zoning, residential densities, and commercial/industrial nature of the area. (c) The 10-year, 20-year and ultimate population projections of the enlarged area and the corresponding estimated average and peak quantity of flow expressed in million gallons per day (MGD). The flow data shall be in the form of a flow versus time curve projected to the ultimate development of the area. (d) The 10-year, 20-year and ultimate estimated quality of flow expressed in biochemical oxygen demand (BOD) and suspended solids (SS), plus any additional pertinent information regarding the quality of flow expected, particularly from industrial sources. {00096389.DOC v.1} 23 (e) A letter from all existing sanitation districts or other sewer service entities within five miles of the proposed area stating the feasibility of providing service to the proposed service area and the justification for not connecting to other existing facilities where feasible. (f) Institutional arrangements such as contracts and/or covenant terms for all users within the proposed service area to insure proper operation and maintenance of the connector's wastewater collection system. (g) Management capabilities, including user contracts, operating agreements, pretreatment requirements, etc., for controlling the wastewater collection system on a continuous long-term basis. 6.1.5 Service Area Information: The existing or new Service Provider shall supply other information concerning the proposed additional service area when the District determines that the information is necessary to make a proper decision and appropriate application to the local water quality management agency. It is necessary that requests be submitted and approved by the District prior to proceeding with planning and construction of any District Facilities to serve the area. 6.1.6 Approval Procedures: When the service area adjustment requested by an existing or new Service Provider is within the District's approved sewer service area, the Board of Directors shall act on the request. Service Providers are advised that a minimum of thirty (30) days is required for consideration of service area adjustments within the District's approved sewer service area. When the requested service area adjustment includes land which lies partially or completely outside the District's sewer service area, the Board of Directors shall act on the request and, if appropriate, process an Areawide Water Quality Management Plan Amendment application in accordance with the local water quality planning agency's requirements. Service Providers are advised that a minimum of six (6) months is required for consideration of service area adjustments partially or completely outside the District's approved sewer service area. 6.1.7 Post-treatment Waters: All water produced as a result of the treatment of wastewater in the District Wastewater System from whatever source shall be owned by the District and the District shall retail sole dominion, control and right of use of all such post- treatment water, subject to requirements of court decrees, statutory requirements and provisions of any Agreements. 6.1.8 Prohibited Wastes: Discharge of any water or Wastewater into the District's Wastewater System containing substances prohibited by these Rules and Regulations or not meeting the requirements set forth in this Article 6 is prohibited. 6.1.9 General Prohibition: No person shall discharge or cause to be discharged into a public sewer or in the District's Sewer service area, any harmful waters or wastes, whether liquid, solid or gas, capable of causing interference, obstruction or damage to any of the District Facilities or hazards to District personnel. Prohibited sewage shall include such quantity of clear {00096389.DOC v } 24 water injected into a public sewer which would interfere with the District's Wastewater treatment process. 6.1.10 Construction Modifications to Limit Harmful Waste: Some Customers or Service Providers may be required to install pretreatment facilities, including, but not limited to grease, sand, and/or oil interceptors into their building construction. As required by the District and set forth in Exhibit C hereto, in order to prevent the discharge of such materials and other prohibited wastes into the District's Wastewater System. 6.1.11 Lateral Size: The District shall require all Service Providers to adopt rules and regulations for the design, planning, locating, sizing, and construction of all service laterals and installation thereof, including change orders, in accordance with District standards and requirements set forth in Exhibit D [Reserved]. All costs and expenses of the Customer or Service Provider incurred for the installation and connection of service laterals to the District's Wastewater System shall be the responsibility of the Service Provider. The Service Provider shall be liable to the District for any loss or damage which may directly or indirectly occur by the installation of a service lateral. The Service Provider shall notify the District of any such damage immediately and shall repair such damage within seventy-two (72) hours. If such repairs are not made within such time, the District shall make such repairs and bill the Service Provider therefore. The Service Provider shall reimburse the District for such repairs within thirty(30) days of the date of occurrence. 6.1.12 Maintenance of Laterals: The District shall require Service Providers to adopt rules and regulations providing that Customers shall be responsible for all maintenance, including routine maintenance or maintenance resulting from damage, repair and replacement of the service lateral from the point of connection from the Service Provider's sewer main. The Service Provider or Customer, as determined by the Service Providers' rules and regulations, is responsible for maintenance of the service laterals from the Customer's point of use to the Wastewater Connection Point. The Wastewater Connection Point shall be determined by the District pursuant to a Connector Agreement between the District and the Service Provider. Maintenance of the service laterals shall include all administrative, monitoring, servicing, repair of all damage whether from abnormal use or not, routine repair or maintenance, and replacements costs. ARTICLE 7. LIMITATIONS ON DISCHARGE 7.1 Limitations On Discharged Wastes/Prohibited Wastes. 7.1.1 Standards for Water or Wastewater Discharge into the District's Wastewater System: Service Providers shall comply with all applicable Pretreatment Standards and Requirements. No Service Provider or Customer shall discharge or cause to be discharged into the District's Wastewater System any storm water, surface water, ground water, roof runoff, subsurface drainage, cooling water, air conditioning wastewater or any other domestic or commercial wastewater that does not meet National Pretreatment Standards. {00096389.DOC v } 25 7.1.2 Construction Modifications to Limit the Discharge of Harmful Wastes into the District Facilities, Grease Interceptors/Traps and Sand/Oil Interceptors/Traps: Every Service Provider shall adopt rules and regulations approved by the District sufficient to provide for the proper handling of liquid wastes containing excessive grease, excessive sand or other harmful ingredients, as set forth in Exhibit C hereto. 7.1.3 Review of Plans for the Construction and Installation of Pretreatment Facilities: If any water or wastewater is discharged, or is proposed to be discharged, to the District Facilities (1) from restaurants or other food preparation establishments described above, or (2) that may contain the substances or exceed the limitations for standards for water or wastewater discharged into the District's Wastewater System, the Service Provider shall be responsible for contacting the District regarding planning, review, construction and installation of pretreatment facilities prior to discharging any water or Wastewater into the District's Wastewater System. A process for plan review shall determine the need, method, and size of pretreatment facilities required to pretreat or otherwise control the Wastewater to make it acceptable for discharge into the District Facilities. 7.1.4 Sampling Manholes: The District may require Service Providers to adopt regulations requiring the installation of one or more discreet sampling manholes. All placements of sampling manholes must be approved by the District prior to installation. 7.1.5 Interceptor/Trap Maintenance: (a) Responsibility for Maintenance: Service Provider regulations shall require that it shall be the Customer's responsibility to ensure that grease and sand/oil interceptors/traps are maintained and in proper working order. The interceptors shall be unobstructed and available for periodic maintenance inspections and discharge sampling by the Service Provider and the District. (b) Inspection: Existing interceptor/trap installations shall be inspected by the Service Provider to determine compliance with the District's oil and grease discharge standards. Installations not able to achieve compliance with such standards due to improper design shall be modified or replaced in order to achieve compliance with District Design Standards, including design and sizing criteria as set forth in Exhibit D hereto. (c) Reports: Service Providers shall provide the District with periodic reports of maintenance as requested by the District. 7.1.6 Interceptor/Trap Requirements for Existing Property/District Facilities: Service Provider regulations shall require inspection of existing Customer facilities to determine whether any existing pretreatment facility is deficient in size, or waste emanating from the property, business or industry violates the District's Rules and Regulations and/or may cause harm to the District Facilities, or persons entering said District Facilities to perform maintenance, or to the treatment process and/or environment. The Service Provider shall require the Customer to install suitable pretreatment facilities or take other appropriate remedial measures as directed by the District. (00096389.DOC v:1) 26 7.1.7 Construction Modifications to Limit Harmful Wastes, Wash Racks/Floor Slabs. All wash rack construction or modification plans must be approved by the Service Provider in accordance with District Design Standards set forth in Exhibit D hereto. ARTICLE 8. PRETREATMENT REQUIREMENTS 8.1 General. 8.1.1 Authority: This Article 8 is adopted by the District in accordance with the authority conferred in the Clean Water Act, and any regulations implementing the Clean Water Act, including, but not limited to, 40 CFR 403.8, the Colorado Water Quality Control Act, and any regulations implementing the Colorado Water Quality Control Act, C.R.S. §§25-8-101 et seq., and the Safe Drinking Water Act, and any regulations implementing the SDWA, with all the powers thereof which are specifically granted to the District, or are necessary or incidental to or implied from power specifically granted therein for carrying out the objectives and purposes of the District and this Article 8. The provisions in this Article 8 shall be called the Pretreatment/Industrial Waste Control Program of the District. 8.1.2 Compliance: The Pretreatment/Industrial Waste Control Program of the District is designed to enable the District to comply with all conditions of its National Pollutant Discharge Elimination System (NPDES) Permit, Federal Pretreatment Regulations, and any applicable sludge disposal regulations, and to meet the following objectives: (a) To prevent the introduction of pollutants into the District Facilities which will interfere with the operation of the Water or Wastewater Systems or contaminate the sludge. (b) To prevent the introduction of pollutants into the Water or Wastewater System which will pass through the Wastewater System, inadequately treated, into the receiving waters or the atmosphere. (c) To prevent the introduction of pollutants into the Wastewater System which might constitute a hazard to humans or to animals. (d) To assure the District's ability to recycle and reclaim Wastewater and sludge. (e) To protect human health and welfare, the environment, property and the District's Publicly Owned Treatment Works. {00096389.DOC v:1} 27 PART A RULES AND REGULATIONS FOR SERVICE PROVIDER USE OF DISTRICT WASTEWATER SYSTEM 8.2 Applicability. Any Service Provider, the sewage from which directly or indirectly enters the Wastewater System of the District from areas within or without the boundaries or Service Area of the District, shall be subject to the requirements of this Part and shall be bound by these Rules and Regulations as they now exist or may hereafter be amended. All Service Providers with industrial customers are required to design and administer Pretreatment Industrial Waste Control Programs which are in accordance with this Part A of Article 8, and which will enable the District to comply with all pretreatment and effluent limitation conditions of its National Pollutant Discharge Elimination System (NPDES) Permit, Federal Pretreatment Regulations, and applicable sludge disposal regulations. 8.3 Compliance With Requirements. [Reserved] 8.4 Legal Authority Requirements. [Reserved] 8.5 Program Procedure Requirements. 8.5.1 Industrial Waste Survey: Each Service Provider shall formulate and implement procedures for conducting ongoing, comprehensive industrial waste surveys to locate and identify all Significant Industrial Users discharging to the Service Provider's sewer system. The District shall make the final determination as to whether a particular Industrial User is a Significant Industrial User. To this end, the District may require that a Service Provider collect and forward to the District all information necessary to make this determination. 8.6 Extra-Jurisdictional Industrial Users. [Reserved] 8.7 Exemptions. A Service Provider administering a Pretreatment Program, separate from that of the District, which has been approved by the Regional Administrator of EPA or the Director of the Water Quality Control Division of the Colorado Department of Health in accordance with §403.11 of the Federal Pretreatment Regulations, may be exempted from compliance with certain provisions of this Article 8, as determined by the District. {00096389.DOC v:I} 28 8.8 Program Review. [Reserved] 8.9 Remedies. 8.9.1 Emergency Remedies: Where a discharge to the Wastewater System reasonably appears to present an imminent endangerment to the health or welfare of persons, or presents or may present an endangerment to the environment, or threatens to interfere with the operation of the District, the District shall immediately initiate investigative procedures to identify the source of the discharge, and take any steps necessary to halt or prevent the discharge. If necessary, the District shall seek injunctive relief against the violating Service Provider and any User contributing significantly to the emergency condition. 8.9.2 Routine Remedies: If the District determines that a Pretreatment/Industrial Waste Control Program as administered by a Service Provider is not in compliance or that the discharge from a Service Provider is not in compliance with District Standards, the District shall issue a notice setting forth the Requirements and Standards not being complied with and directing the Service Provider to attain conformance to these Requirements and Standards within a period of ten (10) days. If after ten (10) days, the Service Provider has failed or refuses to comply with this notice,the District may issue an additional notice setting forth remedial actions to be taken by the violating Service Provider and a time schedule for attaining compliance with all Pretreatment/ Industrial Waste Control Requirements and Standards. If after thirty (30) days notice, the violating Service Provider has not taken necessary steps to correct the violation, the District may assume in whole or in part Pretreatment/Industrial Waste Control Program responsibilities in lieu of the violating Service Provider. The District may continue in this capacity until the violating Service Provider agrees to the original terms of the notice and any additional terms which the District feels are necessary to ensure ongoing compliance by the Service Provider with all Pretreatment/ Industrial Waste Control Requirements and Standards. The Service Provider shall be liable for all costs associated with the District's assumption of responsibilities on behalf of the Service Provider and the District may recover such costs in any manner permitted by law. 8.10 Program Preemption. [Reserved] 8.11 Program Delegation. [Reserved] 8.12 District Monitoring. For the purpose of determining the quantity, quality, and other characteristics of any sewage which shall be or may be delivered and discharged into the Wastewater System by a Service Provider, or into the system of a Service Provider by any User, the District shall have the {00096389.DOC v:I} 29 right at all reasonable times to enter upon and to inspect the Service Provider's system or any industrial or commercial installations connected thereto or any other connections which contribute sewage or Wastewater to the Service Provider's system and to inspect and copy records, to take samples and to make tests, measurements, and analyses of sewage or other wastes in, entering, or to be discharged into such Service Provider's system. 8.13 General Requirements Regarding Deleterious Wastes. None of the following described sewage, water, substances, materials or waste shall be discharged into the District's Wastewater System; and each governing body of each Service Provider shall prohibit and shall prevent any discharges from any outlet into its sewer system, if such discharges cause or significantly contribute to a violation of any of the requirements contained herein: (a) Sewage of such a nature and delivered at such a rate as to impair the hydraulic capacity of the District's Wastewater System, normal and reasonable wear and usage excepted. (b) Sewage of such a quantity, quality, or other nature as to impair the strength or the durability of the sewer structures, equipment or treatment works, either by chemical or by mechanical action. (c) Sewage having a flash point lower than 187°F, as determined by the test methods specified in 40 CFR §261.21. (d) Any radioactive substance, the discharge of which, does not comply with Article RH 4.18 of the Colorado Rules and Regulations pertaining to Radiation Control (Volume 6 of the Code of Colorado Regulations, 6 CCR 1007-1, Part 4, et seq.). (e) Any garbage other than that received directly into the Service Provider's sewer system from domestic and commercial garbage grinders in dwellings, restaurants, hotels, stores, and institutions, by which such garbage has been shredded to such a degree that all particles will be carried freely under flow conditions normally prevailing in public sewers with no particle greater than one-half(1/2) inch in any dimension. (0 Any night soil or septic tank pumpage, except by permit in writing from the District at such points and under such conditions as the District may stipulate in each permit. (g) Sludge or other material from sewage or industrial waste treatment plants or from water treatment plants, except such sludge or other material, the discharge of which to the District Wastewater System shall be governed by the provisions of these Rules and Regulations or any Connector Agreement or as otherwise authorized by the District. (h) Water which has been used for cooling or heat transfer purposes without recirculation, discharged from any system of condensation, air conditioning, refrigeration, or similar use. (00096389.DOC v.11 30 (i) Water accumulated in excavations or accumulated as the result of grading, water taken from the ground by well points, or any other drainage associated with construction. (j) Any water or wastes containing grease or oil and other substances that will solidify or become discernibly viscous at temperatures between 32°F and 150°F except by permit in writing from the District at such points and under such conditions as the District may stipulate in each permit. (k) Any wastes that contain a corrosive, noxious, or malodorous material or substance which, either singly or by reaction with other wastes, is capable of causing damage to the District's Wastewater System or to any part thereof, of creating a public nuisance or hazard, or of preventing entry into the sewers for maintenance and repair. (1) Any wastes that contain concentrated dye wastes or other wastes that are either highly colored or could become highly colored by reacting with any other wastes, except by permission of the District. (m) Any wastes which are unusual in composition; i.e., contain an extremely large amount of suspended solids or BOD; are high in dissolved solids such as sodium chloride, calcium chloride, or sodium sulfate; contain substances conducive to creating tastes or odors in drinking water supplies; otherwise make such waters unpalatable even after conventional water purification treatment; or are in any other way extremely unusual unless the District determines that such wastes may be admitted to the District Wastewater System or shall be modified or treated before being so admitted. (n) Any substance which may cause the District's effluent or any other product of the District such as residues, sludges or scums, to be unsuitable for reclamation and reuse or to interfere with the reclamation process. In no case, shall a substance discharged to the Wastewater System cause the District to be in non-compliance with sludge use or disposal criteria, guidelines or regulations developed under Article 405 of the Clean Water Act; any criteria, guidelines, or regulations affecting sludge use or disposal developed pursuant to the Solid Waste Disposal Act, the Clean Air Act, the Toxic Substances Control Act, or State criteria applicable to the sludge management method being used. (o) Any substance which may cause the District to violate its National Pollutant Discharge Elimination System (NPDES) Permit or the receiving water quality standards. (p) Except for existing combined sewer facilities, any storm water, directly or indirectly, from surface drains, ditches, or streams, storm or combined sewers, roof, areaway, sumps and sump pumps, or foundation drains, or from any other means, including subsurface drainage or groundwater. 8.14 Prohibited Discharges. None of the following described sewage, water, substances, materials, or wastes shall be discharged into the District's Wastewater System or into the sewer system of a Service {00096389.DOC v } 31 Provider, by any User and each governing body of each Service Provider shall prohibit and shall prevent such discharges by any User, either directly or indirectly, into its sewer system: (a) Any liquids, solids or gases which by reason of their nature or quantity are, or may be, sufficient either alone or by interaction with other substances to cause fire or explosion or be injurious in any other way to the District's Wastewater System, the sewer system of a Service Provider or any of its connectors, or to the operation of the District. At no time shall any reading on an explosion hazard meter, at the point of discharge into the District's Wastewater System or the sewer system of a Service Provider or any of its Customers (or at any point in the Wastewater Systems), or at any monitoring location designated by the District in a wastewater contribution permit, be more than ten percent (10%) of the Lower Explosive Limit (LEL) of the meter. Prohibited materials include, but are not limited to, gasoline, kerosene, naphtha, benzene, toluene, xylene, ethers, alcohols, ketones, aldehydes, peroxides, chlorates, perchlorates, bromates, carbides, hydrides, and sulfides. (b) Any solid or viscous material which could cause an obstruction to flow in the sewers or in any way could interfere with the treatment process, including as examples of such materials but without limiting the generality of the foregoing, significant proportions of ashes, wax, paraffin, cinders, sand, mud, straw, shavings, metal, glass, rags, lint, feathers, tars, plastics, wood and sawdust, paunch manure, hair and fleshings, entrails, lime slurries, beer and distillery slops, grain processing wastes, grinding compounds, acetylene generation sludge, chemical residues, acid residues, food processing bulk solids, snow, ice, and all other solid objects, material, refuse, and debris not normally contained in sanitary sewage. (c) Any Wastewater having a pH less than 5.0 for discharges from Industrial Users into the District's Wastewater System or the sewer system of a Service Provider or that of any of its Customers, or less than 6.0 or greater than 9.0 for other discharges into the District's Wastewater System, or wastewater having any other corrosive property capable of causing damage or hazard to any part of the District's Wastewater System or the sewer system of a Service Provider or any of its Customers, or to personnel. (d) Any wastewater having a temperature which will inhibit biological activity at the District's treatment plant, but in no case wastewater containing heat in such amounts that the temperature at the introduction into the District's, Wastewater Treatment Works exceeds 40°C (104°F). (e) Any pollutants, including oxygen demanding pollutants (BOD, etc.) released at a flow rate and/or pollutant concentration which cause Upset. In no case shall a slug load have a flow rate or contain concentrations or qualities of pollutants that exceed for any time period longer than fifteen (15) minutes more than five (5) times the average twenty-four (24) hour concentration, quantities, or flow during normal operation. (0 Any water or wastes containing a toxic substance in sufficient quantity, either singly or by interaction with other substances, to injure or interfere with any sewage treatment process, to constitute a hazard to humans or to animals, or to create any hazard or toxic effect in the waters which receive the treated or untreated sewage. (00096389.DOC v:1} 32 (g) Petroleum oil, nonbiodegradable cutting oil, or products of mineral oil origin, each in amounts that will cause interference or Upset. (h) Pollutants which result in the presence of toxic gases, vapors, or fumes within the system in a quantity that may cause acute worker health and safety problems. (i) Any trucked or hauled pollutants except at discharge points designated by the District. 0) Any water or wastes containing pollutant quantities or concentrations exceeding the limitations in Article 8 of these Rules and Regulations, or the limitations in any applicable Categorical Standards. (k) Any wastewater discharges to the District's Wastewater System, except at locations approved by the District. 8.15 Specific Discharge Limitations— Service Providers. No Service Provider shall discharge to the Wastewater System at any time or over any period of time wastewater containing any of the following materials and substances in excess of the limitations provided herein: Limit mg/L 1. Cyanides (as HCN) 2 2. Oil and Grease (Hexane or approved solvent extractable) 75 3. Phenolic compounds (as Phenol) 10 4. Sulfides (as H2S) 10 {00096389 DOC v1) 33 PART B RULES AND REGULATIONS FOR USERS 8.16 Applicability. (a) A User is any Person who contributes, causes, or permits the contribution of wastewater into the District's POTW. (b) Pursuant to its Service Plan, the District may provide wastewater service to Users through Service Providers. Any User, the sewage from which directly or indirectly enters the Wastewater System of the District from an area within or without the boundaries of the District, shall be subject to the requirements of this Part and shall be bound by these Rules and Regulations as they now exist or may hereafter be amended. Such Rules and Regulations may be enforced against any User. 8.17 General Discharge Prohibitions. No User shall contribute or cause to be contributed, directly or indirectly, any pollutant or wastewater which will interfere with the operation or performance of the POTW. These general prohibitions apply to all such Users of a POTW whether or not the User is subject to national categorical pretreatment standards or any other national, State, district, or local pretreatment standards or requirements: A User may not discharge any of the sewage, water, substances, materials, or wastes listed in Articles 8.13 or 8.14 of these Rules and Regulations. 8.18 Specific Discharge Limitations—Users. 8.18.1 District Limitations: No User shall discharge into the District Wastewater System or into any sewer system at any time or over any period of time, Wastewater containing any of the following materials and substances in excess of the limitations provided herein. These limitations may also be imposed directly on process wastewaters prior to dilution by domestic and other Wastewaters discharged by the User: Limit mg/L 1. Arsenic 0.33 2. Cadmium 3.4 3. Chromium 3.6 4. Copper 6.1 5. Lead 2.2 6. Mercury 0.13 7. Molybdenum 0.71 8. Nickel 5.6 9. Selenium 0.66 10. Silver 2.9 11. Tetrachloroethene 1.5* 12. Zinc 15.6 (00096389.DOC v ) 34 * Notwithstanding this numeric limitation, the discharge of dry-cleaning process wastes, including new and used tetrachloroethene (perchloroethylene), still bottom oil, and separator water, is prohibited entirely. Where necessary the District may require that these wastes be physically prevented from discharging into the District's Wastewater System. 8.18.2 National Categorical Pretreatment Standards: Once promulgated, Categorical Standards for a particular industrial subcategory, if more stringent, shall supersede all conflicting discharge limitations contained in this Article 8, Part B, as they apply to that industrial subcategory. 8.18.3 State Requirements: State requirements and limitations on discharges shall apply in any case where they are more stringent than federal requirements and limitations or those contained elsewhere in this Article 8, Part B. 8.18.4 Dilution Prohibited: [Reserved]. 8.19 Insignificant Discharges. Notwithstanding the prohibitions and limitations contained in Articles 8.17 and 8.18.1 of these Rules and Regulations, the District may allow a proposed discharge to the system if the District determines that the quantity and quality of the discharge, both alone and in conjunction with similar discharges which might be affected by this determination, will have no material effect on the District's operations, including the quality of its effluent or sludges. Approval of the District must be received in writing before the discharge may commence, and the discharge must adhere to any terms and conditions of the District's approval. Approval of such a discharge is entirely at the discretion of the District, and shall not constitute approval of any additional or similar discharges. Disapproval of a proposed discharge by the District shall not be subject to the appeal and hearing procedure set forth in these Rules and Regulations. 8.20 Accidental Or Unusual Discharges. An accidental or unusual discharge is a discharge which may disrupt Wastewater System treatment processes or operations, damage Wastewater System facilities, cause an NPDES Permit violation at the District's treatment plant or degrade sludge quality excessively, or which differs significantly in quantity or quality from discharges under normal operations. 8.20.1 Accidental Discharge Protection: Each User shall provide protection from accidental or unusual discharges of prohibited materials or other substances regulated by these Rules and Regulations. Infrastructure necessary to prevent accidental discharge of prohibited materials shall be provided and maintained at the Customer or User's own cost and expense. 8.20.2 Notification Requirements: (a) Telephone Notification. In the case of any accidental or unusual discharge, it is the responsibility of the User to immediately telephone and notify the District and (00096389.DOC v:1) 35 the Service Provider providing sewage services of the incident. The notification shall include the location of discharge, type of waste, concentration and volume, and corrective actions. (b) Written Notice. Within five (5) days following an accidental or unusual discharge, the User shall submit to the District a detailed written report describing the cause of the discharge and the measures to be taken by the User to prevent similar future occurrences. Such notification shall not relieve the User of any expense, loss, damage, or other liability which may be incurred as a result of damage to the POTW, fish kills, or any other damage to person or property; nor shall such notification relieve the User of any fines, civil penalties, or other liability which may be imposed by these Rules and Regulations or other applicable law. (c) Notice To Employees. A notice shall be permanently posted on the User's bulletin board or other prominent place advising employees whom to call in the event of an accidental discharge. Employers shall ensure that all employees who may cause or suffer such an accidental discharge to occur are advised of the emergency notification procedure. 8.20.3 Slug Discharge Plan Requirements: [Reserved] 8.21 8.21 Hazardous Waste Discharge Notification. Industrial Users shall notify the District, the EPA Regional Waste Management Division Director, and the state hazardous waste authorities in writing of any discharge into the POTW of any substance which, if otherwise disposed of, would be considered a hazardous waste under 40 CFR Part 261. The specific information required to be reported and the time frames in which it is to be reported are found at 40 CFR §403.12(p). 8.22 Wastewater Contribution Permits. [Reserved] 8.23 Reporting Requirements For Significant Industrial Users. [Reserved] 8.24 Monitoring District Facilities. The District may require to be provided and operated at the User's own expense, monitoring facilities to allow inspection, sampling, and flow measurement of any discharges as necessary to determine compliance with the provisions of these Rules and Regulations. There shall be ample room in or near such sampling manhole or facility to allow accurate sampling and preparation of samples for analysis. The facility, sampling, and measuring equipment shall be maintained at all times in a safe and proper operating condition at the expense of the User. The sampling and monitoring facilities shall be provided in accordance with the District's requirements and all applicable local construction standards and specifications. {00096389.DOC v:1} 36 Construction shall be completed within such a time frame as the District shall specify by written notification. 8.25 Information Submittal, Inspection and Sampling. The District may require any User to submit information as necessary to determine compliance with the requirements of these Rules and Regulations. The District may inspect the facilities of any User to ascertain whether the requirements of these Rules and Regulations are being complied with. Persons or occupants of premises where wastewater is created or discharged shall allow the District or its representatives ready access at all reasonable times to all parts of the premises for the purposes of inspection, sampling, records examination and copying, or in the performance of any of their duties. The District, the Colorado Department of Public Health and Environment, and EPA shall have the right to set up on the User's property such devices as are necessary to conduct sampling, inspection, compliance monitoring and/or metering operations. Where a User has security measures in force which would require proper identification and clearance before entry into the User's premises, the User shall make necessary arrangements with security guards so that upon presentation of suitable identification, personnel from the District, the Colorado Department of Public Health and Environment, and EPA will be permitted to enter, without delay, for the purposes of performing their specific responsibilities. All records relating to compliance with pretreatment standards and requirements shall be made available to officials of the District, the Colorado Department of Health, and EPA upon request. 8.26 Wastewater Treatment. Users shall provide wastewater treatment as required to comply with the requirements of these Rules and Regulations, and shall achieve compliance with all national categorical pretreatment standards within the time limitations as specified by the federal pretreatment regulations. Any facilities required to pretreat wastewater to a level acceptable to the District shall be provided, operated, and maintained at the User's expense. 8.27 Confidential Information. Information and data on a User obtained from reports, questionnaires, permit applications, permits, monitoring programs, and inspections shall be available to the public or other governmental agency without restriction unless the User specifically designates and is able to demonstrate to the satisfaction of the District that the release of such information would divulge sales or marketing data, processes, or methods of production entitled to protection as "Confidential Business Information" of the User. Wastewater constituents and characteristics will not be recognized as confidential information. It shall be the User's obligation to stamp each page, which has been demonstrated to the District's satisfaction to contain trade secrets, with the words "Confidential Business Information," "Confidential Information," or "Confidential." A failure by the User to designate and identify any document in this manner {00096389.DOC v l) 37 may result in the document losing its protection from disclosure as confidential business information. Confidential business information shall not be made available for inspection by the public but shall be made available upon request to governmental entities or agencies for uses related to these Rules and Regulations and the District's National Pollutant Discharge Elimination System and Colorado Discharge Pollutant System (NPDES/CDPS) Permit. Confidential business information shall not be transmitted to any governmental agency or entity for other uses by the District except upon written request and after a ten (10) day notification and right to object is given to the User. Such notification shall not be required in certain circumstances provided for in 40 CFR Part 2. If after a request for public inspection, a person or entity challenges the determination of any record to protection as confidential business information, the User shall cooperate, to the fullest extent possible and at User's own expense, with the District in the defense of the determination. At the request of the District the user shall, at the User's expense, provide a defense to such challenge. 8.28 Remedies For Noncompliance; Enforcement. 8.28.1 Notice of Violation: Whenever the District determines that any User has violated or is violating any provision of these Rules and Regulations or a Wastewater Contribution Permit issued or approved hereunder, the District may serve upon such User a verbal or written notice stating the nature of the violation(s). Where directed to do so by the notice, a plan for the satisfactory correction of the violation(s) shall be submitted to the District by the User, within a time frame as specified in the notice. 8.28.2 Administrative Orders: Whenever the District determines that any User has violated or is violating any provision of these Rules and Regulations, or any directives, orders, or permits issued or approved hereunder, the District may serve upon such User a written order stating the nature of the violations(s), and requiring that the User correct the violation(s) within a specified period of time; perform such tasks as the District determines are necessary for the User to correct the violations; or perform such tasks and submit such information as is necessary for the District to evaluate the extent of noncompliance or to determine appropriate enforcement actions to be taken. 8.28.3 Compliance Orders; Compliance Schedules: Whenever the District determines that any User has violated or is violating any provision of these Rules and Regulations, or any directives, orders or permits issued or approved hereunder, the District may serve upon the User a written order requiring that the User submit, within a time frame as specified in the notification, a plan (compliance schedule) for the satisfactory correction of such violation(s). The compliance schedule must represent the shortest schedule by which the User will provide additional treatment or perform such other tasks as will enable the User to consistently comply with applicable requirements. The schedule shall contain increments of progress in the form of dates for the commencement and completion of major events leading to compliance (e.g., Hiring an engineer, completing preliminary plans for pretreatment systems, (00096389.DOC v ) 38 completing final plans, executing contracts for major components, commencing construction, completing construction). In no case shall an increment of progress exceed nine (9) months. Upon approval by the District, the compliance schedule will be issued to the User as an administrative order which contains the approved schedule milestones and any applicable reporting requirements. Issuance of a compliance schedule by the District does not release the User of liability for any violations. Not later than fourteen (14) days following each date in the schedule and the final date for compliance, the User shall submit a progress report to the District including, at a minimum, information on whether or not the User complied with the increment of progress to be met on such date and, if not, the date on which it expects to comply with this increment of progress, the reason(s) for delay, and the steps being taken by the User to return to the schedule established. 8.28.4 Suspension of Service: The District may suspend the wastewater treatment service when such suspension is necessary, in the opinion of the District, in order to stop an actual or threatened discharge which presents or may present an imminent or substantial endangerment to the health or welfare of persons, to the environment, causes pass through or interference or causes the District to violate any condition of its NPDES Permit. Any User notified of a suspension of the wastewater treatment service shall immediately stop or eliminate the discharge. In the event of a failure of the User to comply voluntarily with the suspension order, the District shall take such steps as deemed necessary, including immediate severance of the sewer connection, to prevent or minimize damage to the POTW System or endangerment to any individuals or the environment. The District shall reinstate the wastewater treatment service upon proof of the elimination of the non-complying discharge. A detailed written statement submitted by the User describing the causes of the harmful contribution and the measures taken to prevent any future occurrence shall be submitted to the District within fifteen (15) days of the date of occurrence. 8.28.5 Permit Revocation: (Reserved] 8.28.6 Penalties: Any User who is found to have violated any provision of these Rules and Regulations, or any orders or permits issued or approved hereunder, shall be subject to a penalty not to exceed, except as noted below, ten thousand dollars ($10,000) for such violation. Each day on which a violation occurs or continues shall be deemed a separate and distinct violation. In the case of violations of monthly or other long-term average discharge limitations, penalties may be assessed for each day in the period covered by the violations. In addition to the penalties provided herein, the District may recover reasonable attorney's fees, court costs, court reporter's fees, and other expenses of litigation by appropriate suit at law against the User found to have violated these Rules and Regulations, or the order or permits issued hereunder. Such penalties shall be in addition to any actual damages the District may incur because of such violations. Where a violation is found to have caused Interference or Upset, the maximum penalty of$10,000 per violation as described above may be increased as necessary to allow the {00096389.DOC v:1) 39 District to recover any fines or penalties paid by the District for NPDES Permit violations due to the Interference or Upset. 8.28.7 Legal Action: If any person discharges sewage, industrial wastes or other wastes into the District's wastewater disposal system contrary to the provisions of these Rules and Regulations, or any orders or permits issued hereunder, the District's attorney may commence an action for appropriate legal and/or equitable relief in the District Court of this county. 8.28.8 Appeal and Hearing Procedure: Any User who is aggrieved by any enforcement action taken by the District pursuant to this Article 8.28 may within thirty (30) days of the receipt of notice of the determination, order, or finding being appealed request in writing that the District review the enforcement action. The request (Letter of Appeal) shall state all points of disagreement and objection to the determination, order, or finding. If the District reaffirms the action, the User may appeal this decision and request a hearing. (a) Hearing Request, Deadlines, Procedure and Related Matters [Reserved] 8.29 Charges and Fees. Charges and fees to be assessed against Users will be determined by the District and, where instituted, will be set at a level to allow the District to recover its costs for administering elements of the Pretreatment/Industrial Waste Control Program. Program elements for which charges and fees may be assessed include, but are not limited to, permit applications; monitoring, inspection, and surveillance activities; and general program administration. ARTICLE 9. CROSS-CONNECTION CONTROL AND BACKFLOW CONTROL POLICY AND REGULATIONS 9.1 General. 9.1.1 Policy : It is the intent of the District to protect the District Water System from contamination or pollution by backflow from a Service Provider's or Customer's internal distribution system or private water system, and to provide for the maintenance of a continuing program of cross connection control, which will systematically prevent the contamination or pollution of the District Water System as provided in Exhibit E hereto. 9.1.2 Responsibility: (a) The District may delegate the responsibility for implementing a cross connection control program in accordance with this Article and for enforcement thereof. If a backflow prevention device is required at a Connection Point or at the point of connection from any Service Provider's system to any Customer's premises for the protection of the District Water System, District shall give notice in writing to the Customer to install an approved {00096389.DOC v:1) 40 backflow prevention device at each service connection to the premises. The Customer shall install an approved device or devices at the owner's own expense. (b) No provision of this article exempts the Customer from the cross connection control provisions for internal water distribution systems as contained in the Uniform Plumbing Code, which has been adopted by reference in Chapter 30 of this Code. 9.1.3 Service Provider Requirements. Every Service Provider shall adopt policies and regulations for cross-connection control and backflow control sufficient to: (a) To protect the District's Water System and the water systems of Service Providers from the possibility of contamination or pollution by backflow or backsiphonage. (b) To promote the elimination or control of existing cross- connections, actual or potential, between its Customers' potable water system(s) and non-potable water systems, plumbing fixtures and industrial piping systems. (c) To provide for the maintenance of a continuing program of cross- connection and backflow control, which will systematically and effectively prevent the contamination or pollution of any potable water system. ARTICLE 10. MISCELLANEOUS 10.1 Liability: 10.1.1 District Not Liable: No claim for damage shall be made against the District, and the District and its officials and employees shall not be liable by reason of damage resulting from, but not limited to, any of the following: breaking of any water or wastewater service line, supply line, main line, pipe, cock or meter by any employee of the District; failure of the water supply; shutting off or turning on water in the water main lines; the making of connections or extensions; damage caused by water running or escaping from facilities not owned by the District; damage to water heaters, boilers, or other appliances resulting from shutting water off, or from turning it on, or from inadequate, sporadic and excessive pressures; blockage in the system causing the backup of sewage; breakage of main lines by District personnel; interruption of water or wastewater service and the conditions resulting therefrom where said interruption of service is brought about by request of claimant, or by circumstances beyond the District's control; failure of District Facilities or Service Provider or Customer water and/or wastewater facilities to be located where the District's map indicates they should be; the shutting off of a sewer lift station and possible backflow resulting therefrom; failure to obtain access to isolation valves; or for taking certain actions with respect to the water or wastewater Systems of the District deemed necessary by the Board of Directors or its agents. This paragraph shall not relieve the District from liability for negligence of its employees, if such liability would otherwise have existed. The Service Provider is responsible to make these limitations known to their Customers at or before commencement of service. (00096389.DOC v:l} 41 10.1.2 District Not Responsible for Damages: These Rules and Regulations shall not be construed to hold the District in any manner responsible for any damages to persons or property resulting from any inspections as herein authorized or resulting from the issuance or denial of any permit or failure to approve any Agreement as herein provided, or resulting from the institution of court action as allowed by law, or the forbearance by the District to so proceed. 10.1.3 Officials Not Liable: Any District official or employee, charged with the enforcement of these Rules and Regulations, acting in good faith and without malice on behalf of the District in the discharge of his official duties, shall not thereby render himself or herself personally liable for any damages that may accrue to persons or property resulting from any such act or omission committed in the discharge of such duties. Any suit or proceeding instituted against such official or employee, stemming from any act or omission performed by him in the enforcement or attempted enforcement of any provision of these Rules and Regulations, shall be defended by the District until final termination of the proceedings, in such a manner as to be consistent with the District's resolution indemnifying such officials and employees. 10.1.4 Non-Liability for Work of Others: The District does not assume any liability for any work performed by others. No claim shall be made against the District or any of its officers or employees on account of errors of omission or commission made by the District's licensees or independent contractors. 10.1.5 Indemnity: The Service Provider(s) shall indemnify and hold harmless the District from any losses or damages or claims that may directly or indirectly be occasioned by the installation or operation of any of the Service Provider's facilities or that may arise out of or in connection with any claim against the District resulting from the installation or operation of the Service Provider's facilities or those of their customers. These indemnities shall include all costs for repair or replacement of facilities and all attorneys' fees incurred by the District in defending against such claims. 10.1.6 Non-Waiver: The foregoing indemnity provision, nor any provisions of any contract or other service agreement, shall not constitute a waiver by the District of the defense of sovereign immunity or the Colorado Governmental Immunity Act, or any other defenses it may have to an action against the District, its officials or employees, nor a waiver of its insurance coverage. 10.1.7 Notices and Written Submissions: Any notice, written submission, report or other documentation required under these Rules and Regulations or any Agreement shall be provided to the District by first class, United States mail ("Mail") or by facsimile followed by Mail, to the following: Resource Colorado Water and Sanitation Metropolitan District c/o Special District Management Services 141 Union Blvd., Suite 150 Lakewood, CO 80228 Phone: (303) 987-0835 Fax: (303) 987-2032 (00096389.DOC v:1} 42 With copies to: Gateway American Resources, LLC Consultant to Resource Colorado Water and Sanitation Metropolitan District 4643 S. Ulster Street, Suite 1300 Denver, CO 80237 Attention: Nicole Adams, P.E. Phone: (303) 843-9742 Fax: (303) 843-0143 McGeady Sisneros P.C. 1675 Broadway, Suite 2100 Denver, CO 80202 Attention: MaryAnn McGeady Phone: (303) 592-4380 Fax: (303) 592-4385 ARTICLE 11. PROVISIONS REGARDING MOSQUITO CONTROL SERVICES [RESERVED] ARTICLE 12. PROVISIONS REGARDING STREET IMPROVEMENTS [RESERVED] ARTICLE 13. PROVISIONS REGARDING EMPLOYEE AND PERSONNEL MATTERS [RESERVED] These Rules and Regulations are adopted effective July 18, 2005, as amended April 11, 2007 by the Board of Directors of the Resource Colorado Water and Sanitation Metropolitan District. {00096389.DOC v:I} 43 Exhibit A Schedule of Fees, Rates and Charges [RESERVED] System Development Fees [Reserved] Plant Investment Fees [Reserved] Connection Fees [Reserved] Service Rates and Charges [Reserved] Other Fees and Charges [Reserved] [00096389.DOC v:1) A-1 Exhibit B Connector Agreement for Wastewater Service [RESERVED] (00096389.DOC va) B-1 Exhibit C Pretreatment Discharge Standard to Limit the Discharge of Harmful Wastes into the District's Facilities: Grease Interceptors/Traps and Sand/Oil Interceptors/Traps References to customers in this Exhibit C shall mean service users of the District's Wastewater System pursuant to service agreements between the District and Service Providers. Where these provisions reference the District's right to inspect and enforce these Rules and Regulations, approve connections or otherwise inspect customer use of the Wastewater System, such reference shall not be construed to create a right in the District to provide water or wastewater service directly to individual customers or service users. The District's provision of Water and Wastewater Services shall at all times be pursuant to agreements with Service Providers and the District may apply and enforce these Rules and Regulations or cause the Service Provider to take such action on behalf of the District pursuant to these Rules and Regulations. GREASE INTERCEPTORS/TRAPS APPLICATION This Pretreatment Discharge Standard (PDS) for Food Service Operations defines the local limits, grease interceptor design requirements, and management practices for such facilities. Food service operations subject to this standard include, but are not limited to restaurants, commercial kitchens, cafeterias, food processors, grocery store deli and dairies, schools, fraternal organizations, churches, hospitals, daycare centers, or any other facilities which have the capability to engage in food preparation which are also discharging into a sewer connected to a wastewater treatment facility. This PDS applies to food service operations that: 1. utilize kitchen equipment that discharges oil and grease; or 2. discharge non-domestic waste exceeding the following local limits; or 3. are qualified by the Engineer of the Resource Colorado Water & Sanitation Metropolitan District ("District") to fall under this category. LOCAL LIMITS Food Service Operations (hereafter known as customers) shall not discharge waste which at the point of discharge into a sewer contains: 1. oil and grease in a concentration that is in excess of 75 milligrams per liter as analyzed in a grab or continuous sample; 2. suspended solids in a concentration that is in excess of 350 milligrams per liter as analyzed in a grab or continuous sample; 3. 5-day biochemical oxygen demand (BOD5) in a concentration that is in excess of 350 milligrams per liter in a grab or continuous sample; 4. prohibited waste, restricted waste, special waste, as defined by local, state or federal regulations; or 5. storm water. {00096389.DOC v:l} C-1 GREASE INTERCEPTORS The oil and grease interceptor design shall adhere to the following requirements established by the District and shall be subject to approval by the District's Engineer. Oil and grease interceptors not able to achieve compliance with the District's standards shall be subject to modification and/or replacement. Grease interceptors are required to be installed and maintained by the customer. Variances Existing businesses not contributing significant quantities of oil and grease wastes to the collection system may apply for a variance to the grease interceptor requirement, subject to approval by the District. The variance shall apply strictly to the named business owner/operator located at the named business address, subject to an initial inspection and approval by the District. Businesses subject to the variance may include, but not limited to, delicatessens, sandwich shops, and pizza take outs, whereas other than the preparation of pre-cooked meals, no cooking would take place. Design and Installation Oil and grease interceptors must be approved by the District prior to installation. This is to ensure that the interceptor meets the District's sizing, design (see the following Detail Drawing PDS001 A), and specification requirements as outlined below, as well as any applicable construction standards and plumbing codes. The following information must be submitted to the District's Engineer to obtain approval: • Detailed plans of interceptor and piping • Number and type of fixtures connected • Proposed interceptor location • Proposed interceptor size • Sizing calculations [Remainder of page intentionally left blank] {00096389.DOC v } C-2 Sizing Criteria for Food Grade Oil & Grease Interceptors The basic formula is: (turnover rate) x (categorical use factor (CUF)) x 2.5 (gal. of water) x (seating capacity). The varying sizing applications have been broken into the following categories: Customer Category Sizing Formula Comments RESTAURANT/CAFETERIA 2.0 x 1.0 x 2.5 x Seating 1. Full or limited service with the capability (Equipment: one grill, one to serve or prepare 100 or more meals per fryer, one to three ovens.) day. 2. Plumbing fixtures: one pot sink,one 2 or 3 compartment sink, one hand sink,one mop sink, one floor sink, and one dishwasher. 3. For each food disposal and additional dishwasher that is directed to the Grease Interceptor, there will be a factor of .25 added to the CUF. 4. Equipment: For each additional "wok" stove,deep fryer, and grill, there will be a factor of.50 added to the categorical factor. 5. MINIMUM ACCEPTABLE INTERCEPTOR SIZE IS 750 GALLONS HOSPITALS/SCHOOLS 2.0 x .75 x 2.5 x I. A value of .25 will be added to the bed/seating Categorical Use Factor for each dishwasher or garbage disposal directed to the Grease Interceptor above the number of one each. 2. A value of .50 will be added to the C.U.F. for each additional deep fryer or grill above the number of one each. 3. MINIMUM ACCEPTABLE INTERCEPTOR SIZE IS 750 GALLONS INSTITUTIONS/CARE 2.0 x 1.0 x 2.5 x bed/seating 1.A value of.25 will be added to the FACILITIES Categorical Use Factor for each dishwasher or garbage disposal directed to the Grease Interceptor above the number of one each. 2. A value of.50 will be added to the C.U.F. for each additional deep fryer or grill above the number of one each. 3. Minimum Acceptable Interceptor Size is 750 Gallons I00096389.DOC v:I) C-3 Customer Category Sizing Formula Comments DELI STORES (Hours of operation) x 1. For each of the following conditions, a SUPERMARKETS, 4.0 x 10 factor of.50 is to be added to the C.U.F. value BUTCHERS,and of 4.0 when dealing with meat cutting: BAKERIES 1. more than one floor drain (with meat cutting 2. complete cooking of meats capabilities) 2. When dealing with retail-type bakeries or supermarkets that have bakery facilities in addition to a deli and/or meat cutting, the bakery shall be sized separately using the same formula as above with the dejection of the .50 adjustment for the cooking of meats. 3. There is an adjustment of an addition of 1_5 to the C.F.U. when dealing with bakeries that are wholesale only, or are of the industrial classification. 4. Minimum Acceptable Interceptor Size is 750 Gallons FOOD COURTS and 1. Each case shall be sized by separating "COMMON"TRAPS each of the potential contributors into its own category then combining the operations for a total trap size. 2. Minimum Acceptable Interceptor Size is 750 Gallons COMMISARIES, 1. These must be sized on an individual basis. COMMERCIAL However, it should be noted that the minimum KITCHENS and acceptable size for a commercial kitchen shall CATERERS be 1500 gallons FOOD 1. Each case shall be evaluated separately. MANUFACTURERS Whenever a manufacturing operation is evaluated, it must be noted that a Control Manhole will be required in most cases in addition to a minimum of 1500 gallon Grease Connections to Grease Interceptors An operator of a food service operation shall have the following fixtures connected to the grease interceptor system: a. sinks used for washing pots, pans, dishes, cutlery and kitchen utensils; b. drains serving self-cleaning exhaust hoods installed over commercial cooking equipment; c. drains serving commercial cooking equipment that discharges oil and grease; d. drains serving any garbage compactor used to compact waste that may contain, or be contaminated with, food waste; or e. other fixtures that discharge wastewater containing oil and grease. The following fixtures shall not be connected to a grease interceptor: a. toilets, urinals, clothing washers and hand sinks; b. roof drains or other storm drains. {00096389.DOC v:I) C-4 1) Detail Drawing PDS001A a) Diagram of an Approved Food Grade Oil & Grease Interceptor }IMl1OIE COVER f-•44•—►� i �• BAFFLE WA1l. / YIfMY creRltvet i r vru`r u • TO INLET S11Celik 1 1 ! EXTECIwm _ slFinar-id! WStR BRAC,rr Y l Iyz• i u 1y1' I INTERCEPTOR SPECIFICATIONS 1. Concrete lid and base of interceptor shall be a minimum of 8"thick. Sidewalls shall be a minimum of 5"thick. Baffle wall shall be a minimum of 3"thick. Submit variances to the District for approval. 2. Baffle wall shall extend a minimum of 10"above water level. 3. PVC screw plug clean outs shall be taken to grade and protected by a cast iron lamp hole cover with a locking lid marked "sewer". Lamp hole covers shall be secured in a square concrete pad. The concrete pad shall extend 12" beyond the center of each cleanout and have a depth equal to the lamp hole cover. Concrete pad to be poured at time of final grade. 4. Inlet invert shall be a minimum of 2"higher than outlet invert. 5. Vent may be cast iron or PVC, schedule 40, taken to 6" above roof line or grade depending on location. 6. Interceptor shall be bedded in a minimum of 6" of crushed rock. 7. Grease capacity rated for large compartment only. Secondary compartment has volume equal to 1/3 of total capacity. 8. No bolt down covers allowed without permission from the District. 9. Within trap, all pipe and fittings shall be solvent welded schedule 40 PVC min. 3"diameter. 10. Fill with clean water prior to start up of system. 11. Gray water use only; black water shall be carried by separate sewer. 12. A sampling tee shall be located following the outlet of an interceptor prior to discharge of other waste in the customer's collection line. The tee shall be a minimum of four inches (4") in diameter, installed at right angles to and vertically above the flow of the sewer pipe. Location shall be readily and easily accessible at all times {00096389.DOC v:1) C-5 General Specifications For Grease Interceptors PRE-CAST CONCRETE INTERCEPTORS Pre-cast interceptors shall conform to the size, shape, form, and details shown on the plans. Concrete for pre-cast units shall be Class A concrete defined in the following specifications. All units shall be adequate to withstand AASHTO H-2O (44.30% impact, soil weight = 130 pcf, equivalent fluid pressure = 55 pcf) loading and shall be designed in accordance with ACI 301 and ASTM C-858. All structures not specified in the standard detail shall be submitted to the District for approval as a shop drawing at least 3 weeks prior to installation A flexible plastic joint sealing compound shall be used for any tongue and the groove joints to provide a watertight joint. The performing flexible plastic joint sealing compound shall meet Federal Specifications SS-S-210 and AASHTO M198 75 1, Type B. The sealing compound shall show no visible deterioration when immersed separately in a solution of acid, alkalize and saturated hydrogen sulfide for a period of 30 days. The plastic gasket shall be "Ram-Nek" as manufactured by Henry Co. or an approved equal. All piping within these interceptors shall be solvent weld PVC — SCH 40 DWV. Vertical influent and effluent piping shall be secured to the interceptor walls with non-corroding support brackets. Interceptors installed in a parking lot or a roadway shall have manhole rings and covers raised to grade by using pre-cast concrete riser rings that are a minimum of 6" wide. Cast-In-Place Concrete Interceptors: All cast-in-place grease interceptors shall be designed using the same loading criteria as for pre-cast interceptors. Each interceptor shall be designed by a registered Professional Engineer. For each cast-in-place interceptor, there shall be three sets of wet stamped structural plans submitted to the District for approval. MANHOLE RINGS AND COVERS Manhole rings and covers shall be cast iron in accordance with ASTM A-48, Class 35 B. Twenty- four inch diameter assemblies shall be Neenah-1706, or approved equal, style with a combined weight of not less than 400 pounds (approx. distribution: Frame 235 lbs., Lid 165 lbs.) Covers shall be checkered with letters designating"sewer". All bearing surfaces shall be machined. Manhole lids shall be manufactured with a 1" wide elongated oval lifting hole. Manhole lids with more than one lifting hole shall not be accepted. Rim elevation shall be 2" to 4" above grade in open space and shall be 0" to %" below grade of any finished surface. LOCATION A grease interceptor must be located in a readily and easily accessible area that will not be blocked by vehicular traffic, structural members, or submerged by storm water. {00096389.DOC v:1) C-6 MAINTENANCE The customer shall maintain all grease interceptors installed in connection with the food service operation in accordance with the manufacturer's recommendations for proper function. The grease interceptor must be evacuated entirely when the depth of waste grease in the first pit is 25% of the total depth of the interceptor (e.g. if the operating depth is 30 inches, the interceptor must be pumped when grease layer is 7.5 inches). All grease interceptors must be evacuated at a minimum of every 3 months unless, grease accumulation (25% of depth) requires more frequent evacuation or, subject to approval by the District, it is determined that less frequent pumping is sufficient. Customers shall not dispose of oil or grease from a grease interceptor to a sewer. All cleaning or grease removal shall be accomplished by employing vactor trucks and the contents shall be hauled and disposed of properly and legally off-site and in accordance with all Federal and Local laws and ordinances. Customers must not use or permit the use of chemical agents, enzymes, bacteria, solvents, hot water or other agents to facilitate the passage of oil and grease through a grease interceptor. Use of these products can cause grease to pass through the interceptor and reaccumulate downstream causing costly sewer main blockages. BEST MANAGEMENT PRACTICES Existing sources (entities established prior to the enforcement of this standard) not connected to grease interceptors or those sources connected to in-line interior grease traps, which contribute significant quantities of oil and grease wastes, shall be required to implement Best Management Practices (BMPs). In the event BMPs do not successfully reduce quantities of oil and grease wastes being introduced to the collection system, those sources shall be subject to installation of approved grease interceptors. BMP inspections shall include, however are not limited to, the following: 1. Identification and description of plumbing fixtures 2. Identification of facility grease reduction procedures 3. Identification of facility grease rendering container,where applicable 4. Identification of in-line interior grease trap, where applicable 5. Verification of in-line interior grease trap maintenance records, where applicable 6. Identification of bacterial or enzymatic uses 7. Facility seating capacity 8. Facility hours of operation 9. Facility schedule of routine drain line maintenance OUTDOOR GARBAGE COMPACTORS An owner of an outdoor garbage compactor installation connected to a sewer must install works as necessary to prevent rainwater from entering the drain connected to the sewer. SAMPLING At the request of the District, the customer shall confirm the operation of any grease interceptor via analytical testing. This testing shall be performed by an accredited laboratory, and paid for by the customer. {00096389.DOC v:1} C-7 RECORD KEEPING AND RETENTION Customers must keep a record of all grease interceptor inspection and maintenance activities at the facility where the interceptor is located. Such records shall remain on file for no less than two years and be readily available for inspection by the District. The records shall contain the following: a. the date of inspection or maintenance; b. the maintenance conducted; c. the type and quantity of material removed from the grease interceptor; and d. the location of disposal of the material removed from the grease interceptor. INSPECTIONS The District shall inspect all grease interceptors to ensure compliance with the District's requirements. The inspection frequency shall be, at a minimum, every 6 months, unless the District determines, at its discretion, more or less frequent inspections are required. The inspection criteria shall include, however is not limited to, the following: 1. Location and accessibility 2. Approximate capacity 3. Identification of inlet and outlet compartments, where applicable 4. Identification of inlet and outlet piping systems 5. Identification of bacterial or enzymatic uses 6. Approximate depth of accumulated solids and grease layer 7. Verification of maintenance records The District shall provide written notices to all businesses following inspections. Those businesses determined to be in violation of the District's requirements shall be provided a written notice of non- compliance. Deficiencies found during the inspection shall be corrected by the customer within two weeks of the date of the inspection unless other arrangements are made with the District. Follow-up inspections shall be completed to ensure compliance. Failure to comply may result in fines or may cause the sewer service to the premises in question to be terminated. {00096389.DOC v ) C-8 SAND/OIL REMOVAL OPERATIONS APPLICATION The following standard for sand/oil removal operations defines the local limits, sand/oil interceptor design requirements, and management requirements for waste discharged from mechanical repair shops, automobile service stations, garden nurseries, warehouses, oil and lube centers, car washes/detail centers, parking garages, machine shops, paint spray booths, and other facilities (where the removal of inert solids and/or mechanical lubricants is a primary or supporting operation) with the potential to discharge into a sewer connected to a wastewater treatment facility. This standard applies to sand/oil removal operations that: 1. utilize hydraulic washing equipment or mechanical lubricants and/or floor drains that collect and discharge inert solids and oils; or 2. discharge non-domestic waste exceeding the following local limits; or 3. are qualified by the District's Engineer to fall under this category. LOCAL LIMITS Sand/Oil removal operations (hereafter known as customers) shall not discharge waste, which at the point of discharge into a sewer, contains: 4. oil and grease in a concentration that is in excess of 75 milligrams per liter as analyzed in a grab or continuous sample; 5. prohibited waste, restricted waste, special waste, as defined by local, state or federal regulations 6. storm water. SAND/OIL INTERCEPTORS Sand/Oil interceptors are required to be installed and maintained by the customer. Sand/oil interceptor design and installation shall conform to the following standards. Sand/oil interceptors not able to achieve compliance with the District's standards shall be subject to modification and/or replacement. Variances Existing businesses not contributing significant quantities of inert solids or oil wastes to the collection system may apply for a variance to the sand/oil interceptor requirement, subject to approval by the District. The variance shall apply strictly to the named business owner/operator located at the named business address, subject to an initial inspection and approval by the District. Design and Installation Sand/oil interceptors must be approved by the District prior to installation. This is to ensure that the interceptor meets the District's sizing, design (see the following Detail Drawing PDS002A), and specification requirements as outlined below, as well as any applicable construction standards and plumbing codes. The following information must be submitted to the District's Engineer to obtain approval: {00096389.DOC va) C-9 • Detailed plans of interceptor and piping • Number and type of fixtures connected • Proposed interceptor location • Proposed interceptor size • Sizing calculations Sizing Criteria for Sand/Oil Interceptors The basic formula is: (building surface area in sq. ft.) x (ratio of interceptor capacity (cult.) to building surface area in sq.ft.). Customer Category Sizing Formula Comments Steam Cleaning,Truck Building Area sq.ft. x 1 cu.ft./15 sq ft 1. Minimum sizes is 750 Washes, Heavy Equipment gallons Washes,Garden Nurseries, Automatic Car Washes Manual Car Wash, Building Area sq.ft.x 1 cu. ft./75 sq.ft. 1. Minimum sizes is 750 Automotive Service Garages gallons Machine Shop Building Area sq.ft. x 1 cu.ft./100 sq.ft. 1. Minimum sizes is 750 gallons Paint Spray Booths Building Area sq.ft. x 1 cu.ft./250 sq.ft. 1. Minimum sizes is 750 gallons Printers Building Area sq.ft. x 1 cu.ft/300 sq. ft. 1. Minimum sizes is 750 gallons Warehouses, Parking Garage Building Area sq.ft. x 1 cu.ft/2000 sq.ft. 1. Minimum sizes is 750 (where floors are to be gallons washed) Parking Garage (where Building Area sq.ft. x 1 cu.ft/3000 sq.ft. 1. Minimum sizes is 750 tenants cars are to be washed) gallons Parking Garage (no water Building Area sq.ft. x 1 cu.ft/4000 sq.ft. 1. Minimum sizes is 750 outlets except fire sprinklers) gallons Connections to Sand/oil Interceptors Customers shall have the following fixtures connected to the sand/oil interceptor system: f. Floor drains, sinks for washing parts/equipment, drains serving automatic washing equipment or g. Other fixtures that discharge wastewater containing sand and/or oil. The following fixtures shall not be connected to a sand/oil interceptor: a. toilets, urinals, kitchen sinks, hand sinks, dishwashers, clothing washers; b. roof drains or other storm drain. {00096389.DOC v:1) C-10 Detail Drawing PDS002A Diagram of an Approved Sand/Oil/Water Separator VENT MANHOLE DUAL FACING 24" COVER \ CLEANOUTS zi CAP a WATER LEVEL I}JLET) SANITARY TEE LET ER SUPPORT BRACKET oD BAFFLE WALL 1. Concrete lid and base of interceptor shall be a min. of 8" thick. Side walls shall be a min. of 5" thick. Baffle wall shall be a min. of 3" thick. Submit variances to the District for approval. 2. Top of baffle wall shall match water level. 3. PVC screw plug clean outs shall be taken to grade and protected by a cast iron lamp hole cover with a locking lid marked "sewer". Lamp hole covers shall be secured in a square concrete pad. The concrete pad shall extend 12" beyond the center of each cleanout and have a depth equal to the lamp hole cover. Concrete pad to be poured at the time of final grade. 4. Inlet invert shall be a min. of 2" higher than the outlet invert. 5. Vent may be cast iron or PVC, Schedule 40, taken to 6" above roof line or grade depending on location. 6. Interceptor shall be bedded in a min. of 6" of 3/4" crushed rock. 7. Secondary compartment has volume equal to 1/3 of total capacity. 8. No bolt down covers allowed without permission of the District. 9. Within separator, all pipe and fittings shall be solvent welded Schedule 40 PVC min. 3" diameter. 10. Walls and bottom reinforced throughout w/ 2x16 6/10 remesh. 11. Fill and clean water prior to start up of system. 12. Gray water use only; black water shall be carried by separate sewer. 13. A sampling tee shall be located following the outlet of an interceptor prior to discharge of other waste in the customer's collection line. The tee shall be a minimum of 4 inches in diameter, installed at right angles to and vertically above the flow of the sewer pipe. Location shall be readily and easily accessible at all times. (00096389.DOC v:I) C-1 1 General Specifications For Sand/oil Interceptors PRE-CAST CONCRETE INTERCEPTORS Pre-cast interceptors shall conform to the size, shape, form, and details shown on the plans. Concrete for pre-cast units shall be Class A concrete defined in the following specifications. All units shall be adequate to withstand AASHTO H-2O (44.30% impact, soil weight = 130 pcf, equivalent fluid pressure = 55 pcf) loading and shall be designed in accordance with ACI 301 and ASTM C-858. All structures not specified in the standard detail shall be submitted to THE DISTRICT for approval as a shop drawing at least 3 weeks prior to installation A flexible plastic joint sealing compound shall be used for any tongue and the groove joints to provide a watertight joint. The performing flexible plastic joint sealing compound shall meet Federal Specifications SS-S-210 and AASHTO M198 75 1, Type B. The sealing compound shall show no visible deterioration when immersed separately in a solution of acid, alkalize and saturated hydrogen sulfide for a period of 30 days. The plastic gasket shall be "Ram-Nek" as manufactured by Henry Co. or an approved equal. All piping within these interceptors shall be solvent weld PVC — SCH 40 DWV. Vertical influent and effluent piping shall be secured to the interceptor walls with non-corroding support brackets. Interceptors installed in a parking lot or a roadway shall have manhole rings and covers raised to grade by using pre-cast concrete riser rings that are a minimum of 6" wide. Cast-In-Place Concrete Interceptors: All cast-in-place sand/oil interceptors shall be designed using the same loading criteria as for pre-cast interceptors. Each interceptor shall be designed by a registered Professional Engineer. For each cast-in-place interceptor, there shall be three sets of wet stamped structural plans submitted to the District for approval. MANHOLE RINGS AND COVERS Manhole rings and covers shall be cast iron in accordance with ASTM A-48, Class 35 B. Twenty- four inch diameter assemblies shall be Neenah-1706, or approved equal, style with a combined weight of not less than 400 pounds (approx. distribution: Frame 235 lbs., Lid 165 lbs.) Covers shall be checkered with letters designating "sewer". All bearing surfaces shall be machined. Manhole lids shall be manufactured with a 1" wide elongated oval lifting hole. Manhole lids with more than one lifting hole shall not be accepted. Rim elevation shall be 2" to 4" above grade in open space and shall be 0" to %" below grade of any finished surface. LOCATION A sand/oil interceptor must be located in a readily and easily accessible area that will not be blocked by vehicular traffic or structural members. {00096389.DOC v:1} C-12 MAINTENANCE The customer shall maintain all sand/oil interceptors in accordance with the manufacturer's recommendations for proper function. Customers must not permit oil to accumulate in excess of the lesser of six inches or 25% of the wetted height of the sand/oil interceptor. Customers must not permit sand to accumulate to a height greater than 12 inches below the inlet sanitary tee discharge point. Customers shall not dispose of sand or oil from a sand/oil interceptor to a sewer. All cleaning or sand/oil removal shall be accomplished by employing vactor trucks and the contents shall be hauled and disposed of properly and legally off-site and in accordance with all Federal and Local laws and ordinances. BEST MANAGEMENT PRACTICES: Existing sources (entities established prior to the enforcement of this standard) not connected to sand/oil interceptors which contribute significant quantities of inert solids and/or oils, shall be required to implement Best Management Practices (BMPs). In the event BMPs do not successfully reduce quantities of inert solid or oil wastes being introduced to the collection system, those sources shall be subject to installation of approved sand/oil interceptors. BMP inspections shall include, however are not limited to,the following: 1. Identification and description of plumbing fixtures 2. Identification of facility process 3. Identification of sand/oil reduction procedures 4. Identification of facility sand and oil rendering containers, where applicable 5. Verification of used oil evacuation records (including date and contracted hauler's name and contact information), where applicable 6. Facility square footage 7. Facility schedule of routine drain line maintenance SAMPLING At the request of the District, the customer shall confirm the operation of any sand/oil interceptor via analytical testing. This testing shall be performed by an accredited laboratory, and paid for by the customer. RECORD KEEPING AND RETENTION Customers must keep a record of all sand/oil interceptor inspection and maintenance activities at the facility where the interceptor is located. Such records shall remain on file for no less than two years and be readily available for inspection by the District. The records shall contain the following: a. the date of inspection or maintenance; b. the maintenance conducted; c. the type and quantity of material removed from the sand/oil interceptor; and d. the location of disposal of the material removed from the sand/oil interceptor. (00096389.DOC v ) C-13 INSPECTIONS The District shall inspect all interceptors to ensure compliance with the District's requirements. The inspection frequency shall be, at a minimum, every 6 months, unless the District determines, at its discretion, more or less frequent inspections are required. The inspection criteria shall include, however is not limited to,the following: 8. Location and accessibility 9. Approximate capacity 10. Identification of inlet and outlet compartments, where applicable 11. Identification of inlet and outlet piping systems 12. Approximate depth of accumulated solids and oil layer 13. Verification of maintenance records The District shall provide written notices to all businesses following inspections. Those businesses determined to be in violation of the District's requirements shall be provided a written notice of non- compliance. Deficiencies found during the inspection shall be corrected by the customer within two weeks of the date of the inspection unless other arrangements are made with the District. Follow-up inspections shall be completed to ensure compliance. Failure to comply may result in fines or may cause the sewer service to the premises in question to be terminated. (00096389.DOC v:1} C4 4 Exhibit D District Design Standards and Standards and Requirements for Service Providers [Reserved] (00096389.DOC v:1} D-1 Exhibit E Standards for Cross-Connection Control and Backflow Control Policy and Regulations 1. Definitions: When not clearly otherwise indicated by the context, the following words and phrases in this Article have the following meanings. a. Approved: Accepted by the public works department as meeting the applicable specification stated or cited in this article, or as suitable for the proposed use. b. Auxiliary water supply: Any water supply on or available to the premises other than the District approved public potable water supply. These auxiliary waters may include water from another purveyor's public potable water supply or any natural source such as a well, spring, river, stream, pond, lake, etc., or"used waters" or"industrial fluids." These waters may be polluted or contaminated or may be objectionable and constitute an unacceptable water source over which the District does not have sanitary control. c. Backflow: The undesirable reversal of the direction of flow of the water or mixtures of water and other liquid, gases, or other substances into the distribution pipes of the potable water supply from any source or sources caused by backpressure and/or back-siphonage. d. Back-pressure: The backflow of water or other contaminated fluids caused by a pump, elevated tank, boiler or other means that could create pressure within the Customer's or Service Provider's system greater than the District supply pressure. e. Backflow prevention device: Any device, method, or type of construction designed to prevent backflow or back-siphonage into the public water supply by isolating the Customer's or Service Provider's water system from the public water system. f Air-gap: The unobstructed vertical distance through the free atmosphere between the lowest opening from any pipe or faucet supplying water to a tank, plumbing fixture, or other device and the flood level rim of said vessel. An approved air-gap will be at least double the diameter of the supply pipe, measured vertically, above the top of the rim of the vessel; and, in no case less than one inch. When an air-gap is used at the service connection to prevent the contamination or pollution of the public potable water system, an emergency bypass shall be installed around the air-gap system and an approved reduced pressure principle device will be installed in the bypass system. g. Double check valve assembly: An assembly of two independently operating approved check valves with tightly closing shut-off valves on each side of the check valves, plus properly located test cocks for the testing of each check valve. The entire assembly shall meet the design and performance specifications and approval of a recognized and District- approved testing establishment for backflow prevention devices. To be approved, these devices must be readily accessible for in-line testing and maintenance. h. Reduced pressure principle device: An assembly of two independently operating approved check valves with an automatically operating differential relief valve {00096389.DOC v:I} E-1 between the two check valves, tightly closing shut-off valves on either side of the check valves, plus properly located test cocks, for the testing of the check and relief valves. The entire assembly will meet the design and performance specifications and approval of a recognized and District-approved testing laboratory for backflow prevention assemblies. The device will operate to maintain the pressure in the zone between the two check valves at a level less than the pressure on the public water supply side of the device. At cessation of normal flow, the pressure between the two check valves will be less than the pressure on the public water supply of the device. In case of leakage of either of the check valves, the differential relief valve will operate to maintain the reduced pressure in the zone between the check valves by discharging to the atmosphere. When the inlet pressure is two pounds per square inch or less, the relief valve will open to the atmosphere. To be approved, these devices must be readily accessible for in-line testing and maintenance, and be installed in a location where no part of the device will be submerged. i. Back-siphonage: The backflow of water or other liquids, mixtures or substances into the distribution pipes of a potable water supply system from any source other than its intended source caused by the sudden reduction of pressure in the potable water supply system. j. Certified inspector and tester: Any person who has passed a state approved or sponsored testing and inspection course, and who is listed by the state as a certified inspector/tester. k. Check valve: A self-closing device which is designed to permit the flow of fluids in one direction and to close if there is a reversal of flow. 1. Colorado Department of Health Cross Connection Control Manual: A manual published by the state addressing cross connection control practices, which will be used as a guidance document for the city in implementing a cross connection control program. m. Compliance period: The time between the receipt by the Customer of a notice from the District or designee thereof to install, test, or repair a backflow prevention assembly and the day upon which such installation, testing, or repair shall be completed or ready for inspection by the District or a designee thereof. n. Contamination: Any impairment of the quality of the potable water by pollution from sewage, industrial fluids or waste liquids, compounds or other materials to a degree which creates an actual hazard to the public health through poisoning or through the spread of disease. o. Critical level: The critical level C-L or C/L marking on a backflow prevention device or vacuum breaker which is a point conforming to approved standards and established by the testing laboratory (usually stamped on the device by the manufacturer), which determines the minimum elevation above the flood-level rim of the fixture or receptacle served at which the device may be installed. When a backflow prevention device does not bear a critical level marking, the bottom of the vacuum breaker, combination valve, or the bottom of any such approved device shall constitute the critical level. (00096389.DOC va) E-2 p. Cross connection: Any physical arrangement whereby a public water supply is connected, directly or indirectly, with any other water supply system, sewer, drain, conduit, pool, storage reservoir, plumbing fixture, or other device which contains, or may contain, contaminated water, sewage, or other waste or liquid of unknown or unsafe quality which may be capable of imparting contamination to the public water supply as a result of backflow. Bypass arrangements,jumper connections, removable sections, swivel or changeover devices, and other temporary or permanent devices through which, or because of which, backflow could occur are considered to be cross connections. q. Cross connections, controlled: A connection between a potable water system and a nonpotable water system with an approved backflow prevention device properly installed that will continuously afford the protection commensurate with the degree of hazard. r. Flood-level rim: The edge of the receptacle from which water overflows. s. Hazard, degree of: The term derived from an evaluation of the potential risk to public health and the adverse effect of the hazard upon the public potable water system. t. Hazard, health: Any condition, device, or practice in the water supply system and its operation which could create, or in the judgment of the District, may create a danger to the health and the well being of the water consumer. An example of a health hazard is a structural defect, including cross connections, in a water supply system. u. Hazard, plumbing: A plumbing type cross connection in a consumer's potable water system that has not been properly protected by a vacuum breaker, air-gap separation or backflow prevention device. Unprotected plumbing type cross connections are considered to be a health hazard. v. Hazard, pollutional: An actual or potential threat to the physical properties of the water system or to the potability of the public or the consumer's potable water system which would constitute a nuisance or be aesthetically objectionable or could cause damage to the system or its appurtenances, but would not be dangerous to health. w. Hazard, system: An actual or potential threat of severe damage to the physical properties of the public potable water system or the consumer's potable water system or of a pollution or contamination which would have a protracted effect on the quality of the potable water in the system. x. Industrial fluids system: Any system containing a fluid or solution which may be chemically, biologically or otherwise contaminated or polluted in a form or concentration such as would constitute a health, system, pollutional or plumbing hazard if introduced into an approved water supply. This may include, but not be limited to, polluted or contaminated waters; all types of process water and "used waters" originating from the public water system which may have deteriorated in sanitary quality; chemicals in fluid form; cooling tower and/or cooling towers that are chemically or biologically treated or stabilized with toxic substances; contaminated natural waters such as from wells, springs, streams, rivers, lakes, dams, ponds, retention pits, irrigation canals or systems, etc.; oils, gases, glycerin, paraffins, caustic and acid {00096389.DOC va} E-3 solutions and other liquid and gaseous fluids used in industrial or other purposes or for fire- fighting purposes. y. Multistory building: Any building having two or more levels, excluding the basement, or over forty feet in height. Single family units are excluded from this definition. z. Nonpotable water: Water that is not safe for human consumption or that is of questionable potability. aa. Pollution: The presence of any foreign substance (organic, inorganic, radiological, or biological) in the water that may degrade the water quality so as to constitute a hazard or impair its usefulness. bb. Potable water: Water free from impurities in amounts sufficient to cause disease or harmful physiological effects. The bacteriological, chemical, and radiological quality shall conform with state drinking water regulations. cc. Submerged inlet: A water pipe or extension thereto from the public water supply terminating in a tank, vessel, fixture or appliance which may contain water of questionable quality, waste or other contaminant and which is unprotected against backflow. dd. Vacuum: Any pressure less than that exerted by the atmosphere. ee. Vacuum breaker: Atmospheric nonpressure type: a vacuum breaker designed so as not to be subjected to static line pressure or installed where it would be under pressure for not more than twelve hours in any twenty-four-hour period. ff. Vacuum breaker: Pressure type: a vacuum breaker designed so as not to be subjected to static line pressure. gg. Water service connection: The terminal end of a Service Provider's service connection from the Service Provider's water system, i.e., at the curb stop shut-off valve, property line, or meter. There will be no unprotected takeoffs from the service line ahead of any meter or backflow prevention device located at the point of delivery to the Service Provider's or Customer's water system. Service connection will also include water service connection from a fire hydrant and all other temporary or emergency water service connections from the public potable water system. 2. Requirements. a. Water Systems of Service Providers: Service Provider water systems consist of the source and distribution facilities of their water system to the point of connection of the Customer's system up to the District's Water System. The source includes all components of the facilities utilized in the production, treatment, storage, and delivery of water to the Service Provider's distribution system. The distribution system includes the network of conduits used for the delivery of water from the source to the Customer's water service connection. (00096389.DOC v.1) E-4 b. Plan approval: Service Providers shall adopt requirements setting forth the following: i. All building plans involving water/waste water service, plumbing plans for additions or alterations to existing plumbing systems, and/or irrigation system installation submitted to a planning or building department and shall be reviewed by the public works department and approved prior to the issuance of a building permit. ii. Submitted plans must show: (1) Water service type, size and location. (2) Meter size and location. (3) Backflow prevention assembly size, type and location. (4) Fire sprinkling systems service line, size and type of backflow prevention assembly. c. Installation: Service Providers shall adopt requirements for installation of backflow prevention devices as follows: i. An approved backflow prevention device will be installed at or near the property line, before the first branch line leading off the service line wherever any of the following conditions exist: (1) In the case of premises having an auxiliary water supply which is not or may not be of safe bacteriological or chemical quality and which is not acceptable as an additional source by the Service Provider, the public water system will be protected against backflow from the premises by installing a backflow prevention device in the service line appropriate to the degree of hazard. (2) In the case of premises in which any industrial fluids or any other objectionable substance is handled in such a fashion as to create an actual or potential hazard to the public water system, the public water system shall be protected against backflow from the premises by installing a backflow prevention device in the service line appropriate to the degree of hazard. This will include the handling of process waters and waters originating from the public water system which have been subject to deterioration in quality. (3) In the case of premises having internal cross connections that cannot be permanently corrected and controlled, or having intricate plumbing and piping arrangements, or where entry to all portions of the premises is not readily accessible for inspection purposes making it impracticable or impossible to ascertain whether or not dangerous cross connections exist, the public water system shall be protected against backflow from the premises by installing a backflow prevention device in the service line. (00096389.DOC v:1} E-5 ii. Backflow prevention devices are to be installed in an accessible location to facilitate inspection, testing and maintenance. Adequate drainage area for the device must be provided for in the event that water is released. iii. All connections to the Service Provider's water system, including all existing connections, shall conform or be brought into conformance with the requirements of this chapter within one year of adoption of this chapter. iv. All backflow prevention assemblies shall be installed downstream of the water meter in accordance with the installation details contained in the manuals referenced in Article v. Before installing a backflow prevention assembly, pipelines shall be thoroughly flushed to remove foreign material. vi. Backflow prevention valves shall not be used as the inlet or outlet valve of the water meter. Test cocks shall not be used as supply connections. vii. In order to ensure that backflow prevention assemblies continue to operate satisfactorily, it will be necessary that they be tested by a Colorado State Certified Cross- Connection Control Technician approved by the Service Provider, at the time of installation, and no less than annually thereafter. Such test shall be conducted in accordance with the Foundation for Cross-Connection Control and Hydraulic Research performance standards and field test procedures as directed by the Colorado Department of Health. The backflow assembly test results, plumbing permit and test permit number shall be supplied to the public works department within ten days of the test. viii. The Service Provider will inspect all containment installations and the District may inspect the same upon request. ix. All costs for design, installation, maintenance, repair and testing shall be borne by the Customer. x. All fire sprinkling lines shall have a minimum protection of an approved double check valve for containment of the system. xi. All glycol (ethylene or propylene) or antifreeze systems shall have an approved reduced pressure principal assembly for containment. xii. Dry fire systems shall have an approved double check valve installed upstream of the air pressure valve. xiii. Backflow prevention assemblies shall be installed and inspected in accordance with the codes in Article [Reserved]. xiv. Backflow prevention assembly installations shall be inspected and approved for use by the Service Provider and upon request, the District. Inspections must be scheduled at least twenty-four hours in advance of the desired inspection time. {00096389.DOC v ) B-6 d. Standards: Backflow prevention devices shall adhere to the following standards: i. Any backflow prevention assembly required herein shall be of a model and size approved by the Service Provider. The term approved backflow prevention assembly shall mean an assembly that has been manufactured in full conformance with the standards established by the codes in Article_ [Reserved]. ii. Backflow prevention assemblies currently installed which are not approved shall be replaced with approved assemblies properly installed. iii. Backflow assemblies used on fire lines shall have O.S. and Y. valves listed by Underwriter Laboratories (UL), Factory Manual (FM) and the National Fire Protection Association. iv. Backflow prevention devices currently installed that are not approved shall be replaced with an approved device within one year of adoption of this chapter, unless the device fails an annual operational test. If the device fails any such test, it will be replaced within ten business days with an approved device. v. The following testing laboratory has been qualified by the District to test and certify backflow prevention devices for all Service Providers: [Reserved]. Testing laboratories other than the laboratory listed above will be added to an approved list as they are qualified by the District. 3. Testing Requirements. a. Inspections, testing, and repair. —non-residential connections: It is the responsibility of the Customer to have certified inspections and operational tests made on the backflow prevention device upon installation and at least annually thereafter. The District may require certified inspections at more frequent intervals. These inspections and tests shall be made at the expense of the Customer and will be performed by a certified inspector approved by the Service Provider. A backflow prevention device will be repaired or replaced at the expense of the Customer whenever a device is found to be defective. (00096389.DOC v ) B-7 i. Annually, it will be the obligation of the Customer/User at any premises where any backflow prevention assemblies are installed to have a certified test made of these assemblies. In those specific instances where the Service Provider deems the hazard to be great enough, it will require certified inspection at more frequent intervals. The cost for any test under this section shall be at the Customer's expense. All tests shall be performed by a certified technician approved by the Service Provider. ii. As necessary, the assembly shall be repaired or replaced at the expense of the Customer/User whenever the assembly or assemblies are found to be defective. Records or copies of same, of all such tests, repairs or replacement shall be kept by the test of the assembly and the Customer/User, and a copy or copies shall be sent to the Service Provider within ten days of the test, as described in Article_ [Reserved]. iii. All testing gauges shall be tested and calibrated for accuracy yearly, or more often in the event of questionable readings. iv. The Service Provider retains the right to test or otherwise check the installation and operation of any containment assembly at any time. v. This section shall also apply to all irrigation services. b. Inspections, testing and repair—residential connections: It is strongly encouraged that all residential water service connections have certified inspections completed annually. All inspections and tests shall be made at the expense of the Customer and will be performed by a certified inspector approved by the Service Provider and reported as described in Article_ [Reserved]. i. All water service connections served by the District or a consecutive water system or water district Service Provider served by the District that have any type of auxiliary water supply will be tested according to Article_ [Reserved]. ii. In those specific instances where the District deems that a hazard to the District water system exists, it will require a certified inspection to be completed within five working days of written notification. Annual inspections will continue, based on this chapter, until the public works director deems that a hazard no longer exists. c. Right of entry. i. The Service Provider representative and/or designee assigned to inspect premises relative to possible hazards shall carry proper credentials of his or her office and, upon exhibit of which, said representative shall have the right of entry to inspect any and all buildings and premises for cross-connections in the performance of his or her duties. If such entry is refused, the District or Service Provider or the designated authorized representative thereof shall have recourse to every remedy provided by law to secure entry. ii. This right of entry shall be a condition of continuation of water service in order to provide assurance that the health, safety and welfare of the people throughout the District and Service potable water distribution system is maintained. Where building security {00096389.DOC v ) E-8 is required, the backflow assembly or assemblies should be located in an area not subject to security. Questions regarding proper credentials should be directed to the Service Provider. d. Reporting and record-keeping: The certified inspector will report on a form approved by the Service Provider, the results of inspections, tests, and maintenance to the Service Provider and the property owner. This report will be submitted to the Service Provider within ten days following the completion of the inspection, test, or maintenance of the device. The certified inspector shall also, on a form approved by the Service Provider, attach a card to the backflow prevention device following each inspection, test, or maintenance activity to document and date the activities performed. Records of all inspections, tests, or maintenance activities, including materials and parts changed, shall be kept by the certified inspector, the property owner, and the Service Provider for a period of not less than five years. 4. Enforcement and Fees. a. Compliance. i. Customers shall cooperate in the installation, maintenance, testing or inspection of backflow prevention assemblies. Failure to cooperate shall be grounds for the discontinuance of water service to the premises, or the requirement for air-gap separation from the public potable water system. ii. Service of water to any Customer may be discontinued by the Service Provider if unprotected cross-connections exist on the premises, or if any defect is found in an installed backflow prevention assembly, or if a backflow prevention assembly has been removed or bypassed. Service shall not be restored until such conditions or defects are corrected. iii. Discontinuance of service may be summary, immediate and without written notice whenever, in the judgment of the District administrator or the designated representative thereof, upon the recommendation of the public works director, such action is necessary to protect the purity of the public potable water supply or the safety of the District Water System. b. Violations and penalties. i. Any person who violates any of these Standards shall be punished by a fine of one thousand dollars ($1,000.00). ii. Each such Customer shall be guilty of a separate offense for each and every day during any portion of which any violation is committed, continued or permitted by any such person. iii. The District is authorized to seek recovery of all present and future damages, costs and other relief to which the District is entitled and obtain any available judicial remedies related to maintenance of a cross-connection or any violation of the provisions of this chapter. {00096389.DOC v:1) E-9 EXHIBIT E Intergovernmental Agreements Lost Creek Ground Water Management District Intergovernmental Agreement (07/10/05); describes the agreement for funding a USGS study and the sharing of the information derived from the study. Town of Keenesburg Agreement (4/25/06); sets forth the terms and conditions of the purchase of the water right associated with Well Permit No. 31652-FP by the Town from the District Copy attached. Assignment (7/26/06); assigns all right, title and interest to the water right associated with Well Permit No. 31652-FP to the Town by the District. Copy attached Easement Deed (7/26/06); grants an easement to the Town for access to the Tank Site. Copy attached. Agreement (7/26/06); sets forth the terms and conditions regarding certain specified obligations regarding the decrees and stipulations related to the water right associated with Well Permit No. 31652-FP. Copy attached. Agreement (7/26/06); defines the terms and conditions for the District to use and reuse the water right associated with Well Permit No. 31652-FP, subject to a certain reservation. Copy attached. Letter of Agreement (12/7/06); sets forth the understanding of the Town and the District with regard to the well water transmission line being installed by the Town from Well No. 31652-FP to the Town's water system and a proposed water storage tank site. Copy to be provided when available. Intergovernmental Agreement (7/11/07); sets for the obligations of the Town and the District with regard to the funding of a feasibility study regarding the joint use of the Keenesburg facility to provide service to Pioneer Regional Metropolitan District and Pioneer Metropolitan District Nos. 1-6 to serve Pioneer Communities Phase I. Copy to be provided when available. (00103624.DOC v:3( E-1 071..10/2005 21: 06 303644,cd1 SHERYL PAGE 01 INTERGOVERNMENTAL AGREEMENT This INTERGOVERNMENTAL AGREEMENT is entered this /Q day of July, 2005, by and between the Lost Creek Ground Water Management District (`Lost Creek") and Resource Colorado Water and Sanitation Metropolftan District ("Resource Colorado"), WHEREAS, Lost Creek is a duly formed and operating governmental subdivision of the State of Colorado and a body corporate with all the powers of a public or quasi-munidpal corporation, and Is authorized by C.R.S. g 30-90-130, et seq., to regulate the use, control and conservation of the ground water of the district covered by its permits; and WHEREAS, Resource Colorado is a duly formed and operating Colorado metropolitan district, formed pursuant to Title 32, C.R.S. WHEREAS, Eagle Peak Farms, Ltd. ("Eagle Peak'), Prospect Valley Farms, Ltd. ("Prospect Valley'),the Colorado Ground Water Commission ("Commission') and Lost Creek were parties to Case Nos. 980V1727 and 990V097 in Adams County District Court; and WHEREAS, on November 12, 2003, Eagle Peak, Prospect Valley and the Commission settled all issues in Case No. 99CV097; and WHEREAS, on February 8, 2004, Eagle Peak, Prospect Valley and Lost Creek settled all issues in Case Nos. 08CV1727 and 99CV097 by a Stipulation ("Stipulation"); and WHEREAS, the Stipulation, dated February 6, 2004, provides in part Applicants[Eagle Peak and Prospect Valley] and/or Sweetwater, [LLCg, or its nominee,and the District agree to participate in a study regarding opportunities for water use and water management within the Lost Creek Designated Ground Water Basin and related areas,including,but not limited to,evaluation of aquifer characteristics,opportunities for above ground and underground storage of water, opportunities for groundwater recharge,end the logistics available or required to pursue such opportunities.The Applicants and/or Sweetwater,or its nominee,agree to pay up to Seventy-Five Thousand Dollars($75,000.00)to retain consultants to conduct the study agreed to by the parties.The funds may also be used to construct iacllities,including monitoring wells,install measuring devises,flowmeters,and other structures and equipment to implement the results of the study,as jointly determined by Sweetwater, or its nominee,and the District.The parties may also consult with the Commission and other persons and entities agreed to by the parties.The parties shall agree on a final scope of work that shall be conducted by any Page 1 of 4 ott13710MINTERGOVERNMENTAL AORaauENT.7-8-05.doc 07610/2005 21:06 3036443n81 SHERYL PAGE 02 and all consultants,and on the consultants that would be retained to complete the study no later than sixty days after entry of a decree in these cases,The terms of this paragraph shall bind the Applicant immediately, subject to the provisions of Paragraph B above,and shall bind Sweetwater, or its nominee,and all successive owners upon each Owner's acquisition of an ownership interest in one or more of the water rights that are the subject of this case.In the event of multiple Owners,each Owner shall be jointly and severally liable for the obligations herein,provided,however, that the combined contribution of owners shall not exceed$75,000. WHEREAS, Resource Colorado is the nominee of Sweetwater, LLC, referenced in the Stipulation; and WHEREAS, the United States Geological Survey CUSGS`) has a proposal to study the ground water resources of the Lost Creek Designated Basin (the "Study"), and Lost Creek and Resource Colorado have concluded that such study, as set forth in the attached proposed May 12, 2005, Joint Funding Agreement between USGS and Lost Creek encompasses the subjects set forth in the Stipulation; and WHEREAS, Lost Creek and Resource Colorado wish to set forth the means by which Lost Creek shall enter the Joint Funding Agreement with the USGS for the Study, and by which finding sftall be tendered to the USGS, while ensuring that both Lost Creek and Resource Colorado share equally in any decision that may be required as the Study progresses; and WHEREAS, G.R.S. §29-1-201 authorizes and encourages political subdivisions of the State of Colorado to make the most efficient and effective use of their respective powers and responsibilities by cooperating and contracting with one another. NOW, THEREFORE In exchange for the mutual promises and other valuable consideration set forth herein, Lost Creek and Resource Colorado agree as follows: 1. Lost Creek shall enter the attached Joint Funding Agreement with the USGS for the Study. Seventy-five thousand dollars ($75,000.00) of the funding for the Study shall be deposited with Lost Creek by Resource Colorado, and Lost Creek shall tender it to the USGS pursuant to the terms of this Intergovernmental Agreement and the Joint Funding Agreement. 2. Lost Creek shall ensure that Resource Colorado shall receive copies of all correspondence regarding the Study, shall be invited to attend all meetings related to the Study, and shall be offered the opportunity to provide input to the USGS, Page 2 of 4 411371CAUMEROOVERNMEN AL ADREEMENr.7-0-0S.tlm 07/.10/2005 21:06 3036443ud1 SHERYL PAGE 03 3. Resource Colorado has at its disposal professional resources, Including the results of prior hydrological studies, that may be useful or beneficial to the USGS in the course of conducting the Study. Resource Colorado agrees to provide such resources without charge to the USt3S, and its staff and agents are authorized to communicate with the USGS in furtherance of the Study's objectives. 4. Lost Creek and Resource Colorado have negotiated at length with the USGS regarding the purposes and scope of the Study, and the deliverables USGS will provide. This Agreement is intended to be procedural In nature only, and shall not be interpreted to reflect any party's intent regarding these substantive matters, which are addressed in the Joint Funding Agreement Provided, however, that no modification of the Study shall occur without compliance with the next paragraph, 5. Resource Colorado and Lost Creek shall share equally in every decision the USGS might require In connection with the Study and no decision regarding the study shall be made or implemented except jointly by Resource Colorado and Lost Creek. 6. If Lost Creek and Resource Colorado disagree upon any matter or decision related to this Intergovernmental Agreement the Study or the Joint Funding Agreement, Lost Creek and Resource Colorado agree that either party may invoke the Jurisdiction of the District Court for the County of Adams, Colorado, to resolve the dispute, and that all reasonable costs and attorneys fees shall be paid by the losing party to the prevailing party. Page 3 of 4 0:\7377 0MTERGOVERNMENTAL AGREBA NNT.7-8-06.doe 07(,10/2005 21:06 3038440081 SHERYL PAGE 04 LOST CREEK GROUND WATER MANAGEMENT DISTRICT By: g 65-Stia tilageesir Its RESOURCE COLORADO WATER AND SANITATI ET OLITAN DISTRICT By: °V O:113710MW.TTEROOVERNMEM'ALAGREEMENi,7-gq5, Page 4 of 4 Agreement This Agreement is entered into this XS day of Attica- , 2006 between the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise, (collectively referred to as "Town") and RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, ("District"),who may be referred to individually as a"party" and collectively as the"parties." RECITALS WHEREAS, the District owns or has entered into an agreement to purchase the water right associated with Well Permit No. 31652-FP located in the Lost Creek Designated Ground Water Basin, and other interests associated with said water right; WHEREAS, the Town desires to purchase the water right associated with Well Permit No. 31652-FP and other property interests as described in this Agreement; WHEREAS, the parties have agreed to terms and conditions for the purchase and sale of the water right associated with Well Permit No. 31652-FP and other property interests. NOW,THEREFORE, in consideration of the mutual promises and agreements made herein, the receipt and value of which are expressly acknowledged, the parties hereby agree to the following terms and conditions: • 1. Purchase and Sale of Property. Pursuant to the teens and conditions of this Agreement, the District agrees to sell to the Town and the Town agrees to purchase from the District(1)the water right associated with Well Permit No. 31652-FP issued by the Colorado Ground Water Commission, as more particularly described on Exhibit A, ("Water Right") (2) the groundwater well associated with the Water Right, (3)the existing easements for the groundwater well associated with the Water Rights, existing easements for the reconstruction of the well associated with the Water Right and existing easements for construction of pipelines for delivery of the water associated with the Water Right on the land described on the attached Exhibit B ("Existing Easements"), and (4) an easement with the dimensions One Hundred and Fifty Feet by One Hundred Fifty Feet, together with easements for pipelines to and from the parcel, ("Tank Site") located on land ("Land") described on the attached Exhibit C. 2. Diligence Investigations. The Town will undertake such studies and investigations as may be determined by the Town to be appropriate and as authorized by this Agreement. A. Access. After the Effective Date of this Agreement, the Town, or its agents, may inspect the Existing Easements and the land comprising the Tank Site and shall have reasonable access to the well associated with the Water Right, 1 the Existing Easements and the land comprising the Tank Site for non- destructive testing. The District shall be provided with reasonable notice of dates and times of investigations performed by the agents, consultants or employees of the Town, and the District may have a representative accompany the agents, consultants or employees of the Town during the investigations. B. Records. The District expressly consents to the Town, or its agents, consultants or employees,reviewing and obtaining copies, at the Town's expense, of any and all records maintained by governmental and quasi- governmental entities, and public utility companies regarding the Water Right, the Existing Easements and the Tank Site. The District shall make available to the Town for inspection and copying, at the Town's expense, any and all non-privileged documents and records maintained by the District, or for the District by the District's consultants,pertaining to the following: (A) title to the Water Right,including any and all opinions regarding title to the Water Right, (B)leases and encumbrances on the Water Right,(C)historical use of the Water Right, including but not limited to, any and all records of diversion of water pursuant to the Water Right, any and all records of the land irrigated by the water withdrawn pursuant to the Water Right, any and all records of the types of crops grown and the production of the crops, and any and all precipitation records for the area where the Water Right was used, and any and all power records for facilities providing power for withdrawal of water pursuant to the Water Right, and (D) any and all engineering reports, feasibility studies, surveys, soil reports,environmental investigations and remediations, and other documents pertaining to the Water Right. In the event the documents and records are maintained in a computer readable format, the Town shall have the opportunity to obtain the documents and records in a computer readable format. C. Title and Permitting Documents. To assist the Town in completing investigations of the Water Right,the District has provided, or will provide within five days from the Effective Date of this Agreement,the following information: a. Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV1727, and recorded on June 22,2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder ("Case No. 98CW 1727 Decree"). b. Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1, 2004 in Case No. 99CV0097, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder("Case No. 99CV0097 Decree"). 2 c. A title insurance commitment issued by a title insurance company selected by the District and pertaining to the Existing Easements and the land comprising the Tank Site. d. All conveyance documents by which the PV Water Holdings LLC and District obtained title to the Water Right, the Existing Easements and the land comprising the Tank Site. e. Water Title Status Opinion,prepared by Timothy R. Buchanan,P.C., with an effective date of June 22, 2004 at 7:00 am (Exhibits to the Opinion are available upon request). The Water Title Status Opinion shall be updated to the Effective Date of this Agreement, and shall run to the benefit of the District and the Town. D.Title Conditions. On or before fifteen (15) days after the District provides the Town the title documents described in the preceding paragraph or fifteen(15) days after the Effective Date of this Agreement, whichever is later,The Town shall provide written notice to the District of any objections to title. The District shall respond to the notice of title objections within five(5)days following receipt of the notice of such title objections, and the response shall indicate the position of the District with respect to any such title objections and any curative actions to be taken by the District at or prior to the closing. Within seven(7) days after the Town receives District's response to the notice of title objections,the Parties shall meet to discuss resolution of the title objections ("Title Resolution Meeting"). If the Parties are unable to agree to terms and conditions to resolve any title objections,the Town may, at its option,terminate this Agreement by written notice delivered to the District within ten (10) days following the meeting to discuss resolution of the title objections. If the Town fails to give written notice to the District of any objections to title or notice of termination within the specified time periods,the Town shall be deemed to have waived any such objections or right to terminate based upon title issues. The District shall be obligated to cure any title objections agreed to at the title resolution meeting. The District shall be further obligated to cure any title objection or defect created by the District or as a result of the District's actions or inaction after written notice of title objection by the Town. At the closing hereof, the District shall convey the Water Rights;the Existing Easements and the Tank Site subject only to those title objections accepted or waived by the Town ("Permitted Exceptions")pursuant to the foregoing provisions. 3. Purchase Price. The total purchase price of$1,116,800.00 shall be paid by the Town to the District at the Closing. The purchase price shall be paid by certified funds or wire transfer. The closing shall be held within ninety (90) days following the Effective Date of this Agreement, and shall be held at a mutually agreed date, time and location. The closing date or time may be shortened or extended upon mutual agreement of the parties. 3 4. Conveyance of Water Right and Easements. The Water Right, Existing Easements and Tank Site shall be specified and conveyed pursuant to the following provisions. A.Water Right. The Water Right shall be conveyed by a Special Warranty Deed in the form of the attached Exhibit D. B. Existing Easements. The Existing Easements shall be conveyed by a Special Warranty Deed in the form of the attached Exhibit D. The District does not own the land where the Existing Easements are located. C.Tank Site. Within twenty(20) days prior to the Closing,the Town shall specify a proposed easement comprising the Tank Site parcel within the land described on Exhibit C. In determining the location of the Tank Site parcel, the Town shall use the following criteria: (a) the location shall be as far as practically possible from existing houses or other structures on the Land, (b) the location shall be as close as practically possible to existing access roads, and (c)the location shall, as far as practically possible, minimize interference with farming operations on the Land. After the Town has identified the location of the Tank Site parcel,the Town shall, at its sole cost and expense, obtain a survey of the Tank Site parcel by a professional land surveyor, and obtain any and all other approvals that may be required for the conveyance of the Tank Site parcel. The conveyance of the Tank Site parcel shall be by an Easement Deed in the form of the attached Exhibit E,free and clear of any liens and encumbrances, except for the limitations and exceptions specified on Exhibit C. The pipelines associated with the Tank Site parcel shall be buried at a depth of not less than Four and One-half(4.5) feet. The Tank Site parcel may be fenced by the Town. After installation of the pipelines, the surface of the Land shall be restored to a condition as practically similar to the condition existing prior to the construction and installation of the pipelines. In the event the Land surface in the area of the pipelines was grass or other similar vegetation, the surface of the Land shall be planted with grass or vegetation similar to the existing grass or • vegetation. In the event the Land surface in the area of the pipeline was farmed crops, the surface of the Land shall be tilled,but shall not be replanted with growing crops. The Town shall not pay any crop or vegetation damage associated with the installation of the pipeline. 5. Documents Exchanged at Closing. The following documents shall be exchanged at closing: A. The District shall deliver to the Town the following documents: 4 a. A Special Warranty Deed to the Water Right, in the form of the attached Exhibit D. b. An Assignment, in the form of the attached Exhibit I, and pertaining to (1)the well permit associated with the Well Permit No. 31652-FP, and (2) a divided interest in the Case No. 98CV 1727 Decree and Case No. 99CV0097 Decree, to the extent said Decrees pertain to the Well Permit No. 31652-FP; c. A Bill of Sale, in the form of the attached Exhibit H;pertaining to any personal property associated with the Well Permit No. 31652-FP; d. A Special Warranty Deed to the Existing Easements described above in the form of the attached Exhibit D; e. An Easement Deed to the Tank Site described above in the form of the attached Exhibit E; f. A Real Property Transfer Declaration, in the form of the attached Exhibit F for each deed delivered to the Town; g. Information With Respect to a Conveyance of a Colorado Real Property Interest, in the form of the attached Exhibit G; h. Agreement regarding Decree and Stipulations in the form of Exhibit J. i. Such other documents as are required by this Agreement or are required to effectuate the intent of this Agreement, including any documents required by the Colorado Water Conservation Board or other financing source,under its financing requirements. B. The Town shall deliver to the District the following: a. Certified funds in the amount of$1,116,800.00; b. Such other documents as are required by this Agreement or are required to effectuate the intent of this Agreement. 6. Retained Recaptured Water. As a condition of this Agreement, the District hereby retains the right to all water delivered pursuant to Well Permit No. 31652-FP that is not consumed and is available to be recaptured, reclaimed, reused or otherwise used after a first use of the water in an amount up to 77.7 acre feet per year("Recaptured Water"). The District and the Town shall enter into an agreement for purposes of accounting for the use of the Recapture Water to be executed at Closing. The District and the Town shall agree on a form of agreement within thirty (30) days of the Effective Date of this Agreement. If the District and the Town cannot agree on the form of agreement within the thirty(30) day period, either party may terminate this Agreement and both parties shall be released from all rights, obligations and liabilities under this 5 Agreement. 7. Duplicate Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but which collectively shall be considered one Agreement. Each party represents that each has the right and authority to enter into this Agreement, and that all necessary board or council resolutions have been adopted. 8. Notices. Whenever any notice, demand, or request is required or provided for under this Agreement, such notice, demand, or request shall be provided in writing or by facsimile to the following addresses or such other addresses as may be designated by a party by notice. Notice shall be deemed received when: (1)personally delivered; or (2) when transmitted by facsimile; or (3) three(3)days after having been deposited in a U. S. Postal Service depository to be sent by registered or certified mail,return receipt requested,with all required postage prepaid; or(4) one (1)business day after having been sent by overnight courier: To District: Resource Colorado Water and Sanitation Metropolitan District 141 Union Bld. #150 Lakewood, Colorado 80228 Copy to: Harvey E.Deutsch,President 9145 E. Kenyon Avenue, Suite 200 Denver, Colorado 80237 Facsimile: (303)740-8657 And copy to: McGeady Sisneros, P.C. 1675 Broadway, Suite 2100 Denver, Colorado 80202 Facsimile: (303) 592-4385 To Keenesburg: Mark D. Gray Mayor Town of Keenesburg P. O. Box 312 Keenesburg, CO 80643 Facsimile: (303)732-0599 Copy to: Tad S. Foster P. O. Box 1836 Colorado Springs, CO 80901 9. Time is of the Essence. Time is of the essence with respect to each and every aspect of this Agreement, and strict compliance with all time requirements is at the heart of this Agreement and shall be strictly enforced. 6 10. Authority. The individuals executing this Agreement on behalf of their respective entities are authorized by the entities to execute this Agreement on behalf of their respective entities. 11. Breach. The failure of a party to this Agreement to perform or observe any of the covenants,terms, or conditions of this Agreement,other than a monetary default, such as payment obligations at Closing, shall be an event of default("Event of Default"). If the Town does not deliver the funds at Closing this Agreement shall automatically terminate without any notice from the District and both parties shall be released from all rights, obligations and liabilities under this Agreement. Upon the occurrence of an Event of Default, the non-defaulting party will have the right to enforce its rights under this Agreement and any applicable law by such suit, action, or special proceedings as the party deems appropriate including,without limitation, specific performance of any covenant in this Agreement or, except for the terms of Paragraph 6, the non-defaulting party may elect to terminate this Agreement after written notice and the opportunity to cure within five(5)working days of receipt of • such notice.. Except as otherwise provided for herein, all rights and remedies of the parties may be exercised with or without notice, shall be cumulative, may be exercised separately, concurrently, or repeatedly, and the exercise of any such right or remedy shall not affect or impair the exercise of any other rights or remedy. The failure of a party to insist, on one or more occasions,upon the strict observation of any of the terms of this Agreement shall not be construed as a waiver or relinquishment in any future occasion of any of the terms of this Agreement. The failure of a party to this Agreement to perform or observe any of the covenants, terms shall, after reasonable notice and the opportunity to cure within five (5) days of receipt of such notice,be an event of breach. in the event of a breach or a default of this Agreement and litigation arising out of this Agreement, the prevailing party shall be entitled to all reasonable costs and expenses regarding such litigation,including,but not limited to, attorneys' fees. 12. Entire Agreement; Modifications. The making, execution and delivery of this Agreement by the Parties has not been induced by any representations, statements, warranties or agreements other than those expressed in this Agreement. This Agreement constitutes the entire understanding between the Parties, and all prior negotiations, agreements and understandings, written or oral, concerning the subject matter of this Agreement are considered superceded and merged herein. Modification of this Agreement by the Parties may be made only by a writing signed by the Party or Parties to be bound by the modification. 13. No Limitation on Sale or Agreements. By entering into this Agreement, neither the District nor the Town shall be limited or restricted from entering into other agreements or transactions for sale or lease of other water rights. 7 14. Controlling Law and Venue. This Agreement shall be governed under and controlled pursuant to the laws of the State of Colorado, and the venue for any disputes hereunder shall be in the District Court,Weld County, State of Colorado. 15. Effective Date of Agreement. This Agreement shall be effective on the last date it is signed by all the parties. 16. Recording. This Agreement shall not be recorded at the office of the Weld County Clerk and Recorder, unless agreed to by both the District and the Town. All deeds as reflected in Exhibits D and E and any other documents required by any title • policy shall be recorded. IN WITNESS HEREOF, the parties execute this Agreement effective as of the date set forth above. TOWN OF KEENESBURG, COLORADO, a Colorado municipal corporation acting by and through its at r Activity Enterprise By �s' /// Date: -.9 J —06 Mark - Gray, Mayor ATTEST: Jess CW1— Date: 7 Cheryl Tow lerk RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado /a By: «y ;' H‘ry E. Deutsch Date: 71,/z_,og j 4 Name: Harvey E. Deutsch O�c:Yf-, / Title: President Attest: Steven H. Deutsch Date: y/z5-4c Title: Assistant Secretary 8 STATE OF COLORADO ) / 1 a )ss. COUNTY OF tki)CA ) e foregoing instrument was acknowledged before me this r2.S day of 2006, by Mark D. Gray, as Mayor and by Cheryl Jesser, as Town Clerk of th Town of Keenesburg, Colorado, a Colorado municipal corporation, acting by and through its Water Activity Enterprise. WITNESS my hand and official seal.My commission expires; la-I 3 - O 1p STACY SARGENT NOTARY PUBLIC- , ,S- STATE OF COLORADO jNotary Public My C, 'emission Expires 12/13/2009 STATE OF COLORADO ) )ss. COUNTY OF WELD ) The foregoing instrument was acknowledged before me this 2s day of i ,2006, by Harvey E. Deutsch, as President and by Steven H. Deutsch, as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado,. WITNESS my hand and official seal. My commission expires; ©•- 2?- 2ccg _��.‘\ �\ %\P�G. COp(4i`1 ii °TAR G<tll \,..i00: :Or rit,Uri.. _ . O CCA RA_O-O Notary Public t ' ; i tl i1 ye.,.UD L..G;of° ' ,,,up OF CO1 OPPf 9 EXHIBIT A - DESCRIPTION OF WATER RIGHT The following water right is subject to the teens and conditions of the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV 1727, and recorded on June 22, 2004 as Reception No. 20040622000516130 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder; and the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June I,2004 in Case No. 99CV0097, and recorded on June 22, 2004 as Reception No. 20040622000516120 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder, and is generally described as follows: PARCEL I-2 Final Permit No. 31652-FP issued for a well located in the SWI/4 of the SEl/4 of Section 33, Township 2 North, Range 63 West of the 6th Principal Meridian. The location of Parcel I-2 and the water right associated with the parcel are depicted on the map attached as Exhibit A-I. Pursuant to the Decrees entered in Case Nos. 98CV1727 and 99CV097, the Original Permitted Appropriation,Allowable Annual Withdrawal (Allowable Appropriation in the following table), and Maximum Banking Reserve for the Changed Uses specified in the Decrees shall not exceed the following amounts: Original Pennitted Parcel Well Permit Nos. Appropriation Allowable Maximum No. Appropriation Banking Reserve (acre-feet) (acre-feet) (acre-feet) I-2 31652-FP 267 139.6 382.2 10 I Ie '''. ". :raF V S1 lyZ1 N. JyF, tied rierrra164 Ott I .i. ..1/2451 f a SA , ? � r Fe,C .j/+y• , ssr F{'fi'� A • cuw. — f o.10,7r,77, EXHIBIT A-I �;�?/.� &, 7,0 - z ua cr rums .. ..• oRrsrzi.w:7eu ' )x rrsr.�rser.�w. -': F � =mice,'op �� -_ -:.ter.... .. ...-. EXHIBIT B-DESCRIPTION OF EXISTING EASEMENTS All right, title and interest in and to the easement described in Exhibit A-1 of the Easement Deed made and entered into as of July 14,2004 by and between Gerald R. Graybill, also known as Gerald Graybill, Kelly R. Graybill, also known as Kelly Graybill and PV Water Holdings LLC, a Colorado limited liability company, and recorded on July 20, 2004 as Reception No. 3200652 of the books and records of the Weld County Clerk and Recorder. The Grantor retains all right, title and interest in and to all other easements described in said Easement Deed. • 11 EXHIBIT C- DESCRIPTION OF LAND WHERE TANK SITE PARCEL IS TO BE LOCATED PARCEL I-2A LOT B,RECORDED EXEMPTION NO. 1303-33-3-RE1939,RECORDED DECEMBER 27, 1996 IN BOOK 1583 AS RECEPTION NO 2526795 BEING A PART OF THE WEST ONE- HALF OF THE SOUTHWEST ONE-QUARTER OF SECTION 33,TOWNSHIP 2 NORTH, RANGE 63 WEST OF THE SIXTH PRINCIPAL MERIDIAN, COUNTY OF WELD, STATE OF COLORADO;AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BASIS OF BEARINGS: THE WEST LINE OF THE SOUTHWEST ONE-QUARTER OF SECTION 33,TOWNSHIP 2 NORTH,RANGE 63 WEST OF THE SIXTH PRINCIPAL MERIDIAN BEING ASSUMED TO BEAR N00°37'53"W A DISTANCE OF 2648.95 FEET. MONUMENTED BY A 2"ALUMINUM CAP STAMPED"INTERMII.L LS 12379"AT THE WEST ONE-QUARTER CORNER AND A 2-1/2"ALUMINUM CAP STAMPED"POWERS ELEVATION COMPANY"AT THE SOUTHWEST CORNER. COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 33; THENCE ALONG THE WEST LINE OF SAID SOUTHWEST ONE-QUARTER, N00°37'53"W A DISTANCE OF 30.00 FEET; THENCE N89°13'37"E A DISTANCE OF 30.00 FEET TO THE INTERSECTION OF THE EASTERLY RIGHT-OF-WAY LINE OF WELD COUNTY ROAD 65 AND THE NORTHERLY RIGHT-OF-WAY LINE OF WELD COUNTY ROAD 14,BEING TO THE TRUE POINT OF BEGINNING; THENCE ALONG SAID EASTERLY RIGHT-OF-WAY LINE WHICH IS 30.00 FEFT EAST AND PARALLEL WITH SAID WEST LINE OF THE SOUTHWEST ONE-QUARTER OF SECTION 33,N00°37'53"W A DISTANCE OF 2354.62 FEET,TO THE SOUTHERLY LINE OF LOT A SAID RECORDED EXEMPTION NO. 1303-33-3-RE1939; THENCE ALONG THE SOUTHERLY LINE OF SAID LOT A,N88°38'15"E A DISTANCE OF 256.59 FEET,TO THE SOUTHEAST CORNER OF SAID LOT A; THENCE ALONG THE EASTERLY LINE OF SAID LOT A,N03°53'00"W A DISTANCE OF 261.76 FEET, TO THE NORTHEAST CORNER OF SAID LOT A; THENCE ALONG THE NORTH LINE OF SAID SOUTHWEST ONE-QUARTER, N89°17'40"E A DISTANCE OF 1046.06 FEET,TO THE EAST LINE OF SAID WEST ONE- FIALF OF THE SOUTHWEST ONE-QUARTER; THENCE ALONG SAID EAST LINE, S00°33'43"E A DISTANCE OF 2617.41 FEET,TO SAID NORTHERLY RIGHT-OF-WAY LINE OF WELD COUNTY ROAD 14; THENCE ALONG SAID NORTHERLY RIGHT-OF-WAY LINE WHICH 1S 30.00 FEET NORTH AND PARALLEL WITH SAID SOUTH LINE OF THE WEST ONE-HALF OF THE SOUTHWEST ONE-QUARTER, S89°13'37"W A DISTANCE OF 1284.60 FEET,TO THE POINT OF BEGINNING. 12 PARCEL I-2B A PARCEL OF LAND BEING A PART OF THE EAST ONE-HALF OF THE SOUTHWEST ONE-QUARTER OF SECTION 33,TOWNSHIP 2 NORTH,RANGE 63 WEST OF THE SIXTH PRINCIPAL MERIDIAN, COUNTY OF WELD, STATE OF COLORADO; AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BASIS OF BEARINGS: THE EAST LINE OF THE SOUTHWEST ONE-QUARTER OF SECTION 33,TOWNSHIP 2 NORTH,RANGE 63 WEST OF THE SIXTH PRINCIPAL MERIDIAN BEING ASSUMED TO BEAR S00°29'34"E A DISTANCE OF 2644.99 FEET. MONUMENTED BY A 2-1/2"ALUMINUM CAP STAMPED"INTERMILL LS 12379"AT THE CENTER ONE-QUARTER CORNER AND A 2"ALUMINUM CAP STAMPED"LS 25937"AT THE SOUTH ONE-QUARTER CORNER. COMMENCING AT THE SOUTHEAST CORNER OF SAID SOUTHWEST ONE-QUARTER BEING THE SOUTH ONE-QUARTER CORNER OF SAID SECTION 33; THENCE ALONG THE EAST LINE OF SAID SOUTHWEST ONE-QUARTER, N00°29'34"W A DISTANCE OF 30.00 FEET,TO THE NORTHERLY RIGHT-OF-WAY LINE OF WELD COUNTY ROAD 14 BEING TO THE TRUE POINT OF BEGINNING; THENCE ALONG SAID NORTHERLY RIGHT-OF-WAY LINE WHICH IS 30.00 FEET NORTH AND PARALLEL WITH THE SOUTH LINE OF THE EAST ONE-HALF OF SAID SOUTHWEST ONE-QUARTER, S89°11'18"W A DISTANCE OF 1314.63 FEET,TO THE WEST LINE OF THE EAST ONE-HALF OF THE SOUTHWEST ONE-QUARTER OF SAID SECTION 33; THENCE ALONG SAID WEST LINE ALSO BEING THE EAST LINE OF LOT B, RECORDED EXEMPTION NO. 1303-33-3-RE1939,RECORDED DECEMBER 27, 1996 IN BOOK 1583 AS RECEPTION NO 2526795,N00°33'43"W A DISTANCE OF 2617.41 FEET, TO THE NORTHWEST CORNER OF SAID EAST ONE-HALF OF THE SOUTHWEST ONE- QUARTER OF SAID SECTION 33; THENCE ALONG THE NORTH LINE OF SAID SOUTHWEST ONE-QUARTER, N89°17'40"E A DISTANCE OF 1317.78 FEET,TO THE CENTER ONE-QUARTER CORNER OF SAID SECTION 33; THENCE ALONG SAID EAST LINE OF THE SOUTHWEST ONE-QUARTER OF SAID SECTION 33, 500°29'34"E A DISTANCE OF 2614.99 FEET,TO THE POINT OF BEGINNING. NAME AND ADDRESS OF PERSON CREATING NEWLY CREATED LEGAL DESCRIPTION(§38-35-106.5, C.R.S.) J.R ENGINEERING 6020 GREENWOOD PLAZA BLVD. ENGLEWOOD, CO 80111 (303) 740-9393 13 (Exceptions) 1. All taxes and assessments for the year 2006 and subsequent years, a lien,not yet due and payable. 2. Reservations made by the Union Pacific Railway Company in deed recorded September 30, 1907 in Book 233 at Page 117, and any and all assignments thereof or interests therein,providing substantially as follows: Reserving unto said Company and its assigns all coal that may be found underneath surface of land herein described and the exclusive right to prospect and mine same, also such right of way and other grounds as may appear necessary for proper working of any coal mines that may be developed upon said premises, and for transportation of coal from same. 3. Right of way for the Low Line Lateral as granted to the Henrylyn Irrigation District by deed recorded November 23, 1926 in Book 814 at Page 157. 4. All of the coal, oil, gas, casinghead gas and all ores and minerals of every kind and nature underlying the surface of the realty herein conveyed, together with the full right,privilege and license at any and all times to explore, or drill for and to protect, conserve, mine, take, remove and market any and all such products in any manner which will not damage structures on the surface of the realty herein conveyed, as reserved by Burlington Northern Inc., successor in interest to Chicago, Burlington & Quincy Railroad Company, in Deed recorded June 12, 1981 in Book 938 as Reception No. 1860423, and any interests therein or rights thereunder. 5. Terms, agreements,provisions, conditions, obligations and easements as contained in Recorded Exemption No. 1303-33-3-RE1939 recorded December 27, 1996 in Book 1583 as Reception No. 2526795. 6. Terms, agreements,provisions, conditions, obligations and easements as contained in Request for Notification of Surface Development recorded May 28, 2002 as Reception No. 2955275. 14 EXHIBIT D-SPECIAL WARRANTY DEED SPECIAL WARRANTY DEED (Weld County) THIS DEED, Made this day of , 2006, between RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi- municipal corporation and political subdivision of the State of Colorado, (hereinafter collectively referred to as "grantor"), and the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise whose legal address is , (hereinafter collectively referred to as "grantee"). The grantor, for the consideration of Ten Dollars ($10.00) and other good and valuable consideration, hereby sells and conveys to the grantee, the following real property, together with improvements, in the County of Weld, State of Colorado, to wit: See Attached Exhibit A. with all its appurtenances and warrants the title against all persons claiming under the grantor. IN WITNESS WHEREOF,the grantor has executed this deed on the date set forth above. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado By: Harvey E. Deutsch,President Attest: By: Steven H. Deutsch Title:_Assistant Secretary 15 STATE OF COLORADO ) ) ss. COUNTY OF The foregoing instrument was acknowledged before me this day of ,2006,by Harvey E. Deutsch as President and Steven H. Deutsch as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DIS I'RICT, a quasi-municipal corporation and political subdivision of the State of Colorado. Witness my hand and official seal. My commission expires: Notary Public ACCEPTED AND AGREED TO THIS DAY OF ,2006. TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise By: Mark D. Gray,Mayor ATTEST: Cheryl Jesser, Town Clerk 16 STATE OF COLORADO ) ss. COUNTY OF WELD ) The foregoing instrument was acknowledged before me this day of ,2006, by Mark D. Gray as Mayor and by Cheryl lesser as Town Clerk, of the TOWN OF KEENESURG Witness my hand and official seal. My commission expires: Notary Public 17 EXHIBIT E-EASEMENT DEED EASEMENT DEED THIS EASEMENT DEED is made and entered into as of the day of , 2006, by and between RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado,hereinafter called "Grantor", and the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise hereinafter called "Grantee,"whose address is WITNESSETH: For good and valuable consideration, the receipt whereof is hereby acknowledged, Grantor hereby grants to Grantee, it successors and assigns, an Easement for the non- exclusive and permanent right to enter, re-enter, occupy and use the hereinafter described Property to construct, maintain, repair, replace, remove, enlarge and operate a water storage tank, water pipelines and all underground and surface facilities related thereto, including by example, but not by way of limitation, the following: electric or other control systems, underground cables, wires, equipment used in the delivery of water, connections, mains and conduits, valves, vaults, well housings ("Facilities"), access to, ingress and egress from the property with vehicles of any type or description and the like in, through, over and across the following described parcel of land situate, lying and being in the County of Weld and State of Colorado,to wit: Property described in Exhibit A., attached hereto and made a part hereof as if fully set forth herein. IT IS HEREBY MUTUALLY covenanted and agreed by and between the parties hereto as follows: With respect to easements on the Property described in Exhibit A that are used for access, ingress and egress, the Grantee shall have and exercise the right of access, ingress and egress in, to, over, through and across the Property described in Exhibit A for the full use of the Easement provided for herein. With respect to easements on the Property described in Exhibit A that are used to construct, maintain, repair, replace, remove, enlarge and operate a water storage tank, Grantee may construct a permanent water storage tank on the surface of the easement, and may fence the easement and the Grantee shall have the exclusive use of the portion of the easement comprising the permanent water storage tank, and fenced area. 18 With respect to easements on the Property described in Exhibit A that are used for water pipelines and all underground and surface facilities related thereto, including by example, but not by way of limitation, the following: electric or other control systems, underground cables, wires, equipment used in the delivery of water, connections, mains and conduits, valves, Grantee shall bury such structures at a depth of not less than four and one-half (4.5) feet and shall not fence the easement. Grantee shall have and exercise the right of subjacent and lateral support for the full and complete use of the easement. It is specifically agreed between the parties that the Grantor shall take no action which would impair the earth cover over, or the lateral or subjacent support for, any water line or related Facilities within the easement, provided, however that upon obtaining the specific written permission of Grantee, the earth cover over any pipeline or lines may be modified; except that permission normally will not be granted for modification involving cover of less than four and one-half (4.5) feet, nor greater than ten (10) feet measured vertically from the top of any lines or Facilities. After construction, repair, replacement or enlargement of any lines or Facilities within the easement, the general surface of the ground shall be restored as nearly as reasonably can be done given the existence of these lines or Facilities to the grade and condition it was in immediately prior to construction. Topsoil shall be replaced in cultivated and agricultural areas, and any excess earth resulting from installation by Grantee shall be removed from the easement at the expense of Grantee. Grantee agrees that for a period of one year following construction which involves disturbance of the surface of the ground, Grantee will maintain the surface elevation by correcting any settling or subsiding that may occur as a result of the work done by Grantee within the easement. • Grantor retains the right to the use and occupancy of the Property insofar as such use and occupancy is consistent with and does not impair Grantee's use of the Easement. It is mutually agreed by and between the parties hereto that Grantee may commence the exercise of its rights to the use of the Easement forthwith, or it may postpone the exercise of all or some part of its rights hereunder to some future time. Each and every one of the benefits and burdens of this Agreement shall inure to and be binding upon the respective legal representatives, successors and assigns of the parties hereto. In the event any party hereto or its successor or assign seeks to enforce its rights hereunder through litigation, arbitration or other administrative proceeding, the non-prevailing party shall be required to pay to the prevailing party as pad of any judgment, order, or award reasonable attorney fees and costs. 19 The Grantor reserves the right to grant further easement interests in the Property to other utilities and grantees provided that such further easement interests shall not interfere with or impair the easements granted to the Grantee planned Facilities. Unless special provisions are attached hereto, the above and foregoing constitute the whole agreement between the parties and no additional or different oral representation; promise or agreement shall be binding on any of the parties hereto, with respect to the subject matter of this Agreement. Grantors warrants the title to the easements against all persons claiming under the grantor. IN WITNESS WHEREOF, the grantor has executed this deed on the date set forth above. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado By: Harvey E.Deutsch,President Attest: By: Steven H. Deutsch • Title: Assistant Secretary 20 STATE OF COLORADO ) ss. COUNTY OF The foregoing instrument was acknowledged before me this day of 2006, by Harvey E. Deutsch as President and Steven H. Deutsch as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION MEIROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado. Witness my hand and official seal. My commission expires: Notary Public ACCEPTED AND AGREED TO THIS DAY OF , 2006. TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise By: Mark D. Gray, Mayor Al FEST: Cheryl Jesser, Town Clerk 21 STATE OF COLORADO ss. COUNTY OF WELD ) The foregoing instrument was acknowledged before me this day of ,2006, by Mark D. Gray as Mayor and by Cheryl Jesser as Town Clerk, of the TOWN OF KEENESURG Witness my hand and official seal. • My commission expires: Notary Public 22 Exhibit A to Easement Agreement (legal description of Property) 23 EXHIBIT F-REAL PROPERTY TRANSFER DECLARATION REAL PROPERTY TRANSFER DECLARATION GENERAL INFORMATION Purpose: The Real Property Transfer Declaration provides essential information to the county assessor to help ensure fair and uniform assessments for all property for property tax purposes. Refer to 39-14-102(4), Colorado Revised Statutes (C.R.S.). Requirements: All conveyance documents (deeds) subject to the documentary fee submitted to the county clerk and recorder for recordation must be accompanied by a Real Property Transfer Declaration. This declaration must be completed and signed by the grantor(Resource) or grantee (buyer). Refer to Section 39-14-102(1)(a), C.R.S. Penalty for Noncompliance: Whenever a Real Property Transfer Declaration does not accompany the deed, the clerk and recorder notifies the county assessor who will send a notice to the buyer requesting that the declaration be returned within thirty days after the notice is mailed. If the Real Property Transfer Declaration is not returned to the county assessor within the 30 days of notice, the assessor may impose a penalty of$25.00 or .025% (.00025) of the sale price, whichever is greater. This penalty may be imposed for any subsequent year that the buyer fails to submit the declaration until the property is sold. Refer to 39-14- 102(1)(b), C.R.S. Confidentiality: The assessor is required to make the Real Property Transfer Declaration available for inspection to the buyer. However, it is only available to Resource if Resource filed the declaration.Information derived from the Real Property Transfer Declaration is available to any taxpayer or any agent of such taxpayer subject to confidentiality requirements as provided by law. Refer to 39-5-121.5, C.R.S and 39-13- 102(5)(c), C.R.S. 1 Address and/or legal description of the real property sold: Please do not use P.O. Box numbers. See Exhibit A 2 Type of property purchased: _ Single Family Residential _Townhome _ Condominium _ Multi-Unit Res Commercial _ Industrial Agricultural Mixed Use Vacant Land X Other 3 Date of closing: , 2006 Month Day Year 24 4 Total sale price: Including all real and personal property. 5 Was any personal property included in the transaction? Personal property would include, but is not limited to, carpeting, drapes, free standing appliances, equipment. inventory, furniture. If the personal property is not listed, the entire purchase price will be assumed to be for the real property as per 39-13-102, C.R.S. X_Yes No If yes, approximate value $_Unknown Describe_Well equipment_ 6 Did the total sale price include a trade or exchange of additional real or personal property? If yes, give the approximate value of the goods or services as of the date of closing. Yes_X_No If yes, value $ If yes, does this transaction involve a trade under IRS Code Section 1031? _ Yes X No 7 Was 100% interest in the real property purchased? Mark "no" if only a partial interest is being purchased. _X Yes No If no, interest purchased 8 Is this a transaction among related parties? Indicate whether the buyer or Resource are related. Related parties include persons within the same family, business affiliates, or affiliated corporations. Yes X No 9 Check any of the following that apply to the condition of the improvements at the time of purchase. _New_Excellent Good_XX_Average Fair_Poor_Salvage. If the property is financed,please complete the following. 10 Total amount financed. $ 11 Type of financing: (Check all that apply) New Assumed PV Third Party Combination; Explain • 25 uaynme rnone: 3U3-843-Y/42 26 12 Terms: Variable; Starting interest rate Fixed,Interest rate Length of time Years Balloon payment Yes No. If yes, amount Due date 13 Please explain any special terms, Resource concessions, or financing and any other information that would help the assessor understand the terms of sale. For properties other than residential (Residential is defined as: single family detached, townhomes, apartments and condominiums)please complete questions 14-16 if applicable. Otherwise, skip to#17 to complete. 14 Did the purchase price include a franchise or license fee? Yes_X_No If yes, franchise or license fee value $ 15 Did the purchase price involve an installment land contract? Yes X_No If yes, date of contract 16 If this was a vacant land sale, was an on-site inspection of the property conducted by the buyer prior to the closing? Yes_X_No Remarks: Please include any additional information concerning the sale you may feel is important. 17 Signed this day of , 2006 Enter the day, month, and year, have at least one of the parties to the transaction sign the document, and include an address and a daytime phone number. Please designate buyer or seller RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado By: Signature of Grantee (Buyer) or Grantor (Seller)_X_ 141 Union Bld. #150,Lakewood, Colorado 80228 Daytime Phone: 303-843-9742 26 EXHIBIT G - INFORMATION WITH RESPECT TO A CONVEYANCE OF REAL PROPERTY INTEREST DR 1083(12/92) COLORADO DEPARTMENT OF REVENUE 1375 SHERMAN STREET DENVER COLORADO 80261 INFORMATION WITH RESPECT TO A CONVEYANCE OF A COLORADO REAL PROPERTY INTEREST 1. Name(s) and address of transferor(s): RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, 141 Union Bld. #150,Lakewood, Colorado 80228 2. Transferor is (check one): Individual Estate Trust _ Partnership Corporation X Other(specify): Colorado quasi-municipal corporation and political subdivision of the State of Colorado 3. Social Security Number(s) or Colorado Account Number of Transferor: 4 Federal Employer Identification number of Transferor: 5. Type of property sold: Real and Personal Property 6. Address or legal description of property sold: Attached as Exhibit A 7. Date of closing: 8. Selling price of the property $ 9. Selling price of this transferor's interest $ 10. If withholding is made, show amount: $ and computation 11. If withholding is not made, give reason (check one): Affirmation of Colorado Residency; Affirmation of Permanent Place of Business; Affirmation of Principal Residence; Affirmation of no tax reasonably estimated to be due or no gain on sale. 27 12. Name, address, and telephone number of the title insurance company or other person providing closing and settlement services with respect to this transfer: AFFIRMATION OF COLORADO RESIDENCY I (we) hereby affirm that I am (we are) the transferor(s) or the fiduciary of the transferor of the property described on the front side of this form and that as of the date of closing I am (we are) or the estate or the trust is a resident of the State of Colorado. Signed under the penalty of perjury: Signature of transferor or fiduciary Date Spouse's signature if applicable Date AFFIRMATION OF PERMANENT PLACE OF BUSINESS I hereby affirm that the transferor of the property described on the front side of this form is a corporation which maintains a permanent place of business in Colorado or a limited liability company which staffs and maintains a permanent office in the State of Colorado. Signed under the penalty of perjury: • Signature of corporate officer or general partner Date AFFIRMATION OF PRINCIPAL RESIDENCE I (we)hereby affirm that I am (we are) the transferor(s) of the property described on the front side of this form and immediately prior to the transfer it was my(our)principal residence which could qualify for the roll over of gain provision of section 1034 of the Internal Revenue Code. Signed under the penalty of perjury: • Signature of transferor Date Spouse's signature if applicable Date AFFIRMATION OF NO REASONABLY ESTIMATED TAX TO BE DUE 28 I (we)hereby affirm that I am (we are)the transferor(s) or an officer of the corporate- transferor or a fiduciary of the estate or trust-transferor of the property described on the front side of this form, and I (we) further affirm that there will be no Colorado income tax reasonably estimated to be due on the part of the transferor(s) as the result of any gain realized on the transfer. If a partnership is held to be the transferor, I affirm that I am the general partner and that there will be no gain on the sale recognized for federal income tax purposes. Signed under the penalty of perjury: Signature of transferor,officer,fiduciary,or general partner Date FILE THIS FORM TOGETHER WITH FORM 1079,IF APPLICABLE,WITHIN 30 DAYS OF THE CLOSING DATE WITH THE COLORADO DEPARTMENT OF REVENUE 1375 SHERMAN STREET DENVER, CO 80261 • 29 EXHIBIT B-BILL OF SALE BILL OF SALE (Weld County) KNOW ALL MEN BY THESE PRESENTS,That RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, ("Seller") for and in consideration of Ten Dollars ($10.00), to it in hand paid,at or before the ensealing or delivery of these presents by the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise, whose legal address is ,("Buyer") the receipt of which is hereby acknowledged, has bargained and sold, and by these presents does grant and convey under the said Buyer, Buyer's successors and assigns, the following property, goods and chattels,to wit: See attached Exhibit A TO HAVE AND TO HOLD the same unto the said Buyer, Buyer's successors and assigns, forever. The said Seller covenants and agrees to and with the Buyer, his personal representatives, successors and assigns, to WARRANT AND DEFEND the sale of said property, goods and chattels, against all and every person or persons whomever claiming by, through or under Seller. When used herein, the singular shall include the plural,the plural the singular,and the use of any gender shall be applicable to all genders. IN WITNESS WHEREOF, Seller has executed this Bill of Sale this day of , 2006. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT,a quasi-municipal corporation and political subdivision of the State of Colorado By: Harvey E. Deutsch, President 30 Attest: By: Steven H. Deutsch Title: Assistant Secretary STATE OF COLORADO ) ss. COUNTY OF The foregoing instrument was acknowledged before me this day of , 2006,by Harvey E. Deutsch as President and by Steven H. Deutsch as Assistant Secretary, of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado. Witness my hand and official seal. My commission expires: Notary Public 31 Exhibit A to Bill of Sale All pumps,meters, motors, well pumps, pump houses, casing, flow meters and related equipment,but excluding all irrigation pipe, sprinklers, and other equipment used for irrigation purposes,used in conjunction with the following water rights, which are subject to the terms and conditions of the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV1727, and recorded on June 22, 2004 as Reception No. 20040622000516130 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder; and the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1, 2004 in Case No. 99CV0097, and recorded on June 22, 2004 as Reception No. 20040622000516120 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder, and are generally described by the Final Permit issued by the Colorado Ground Water Commission as follows: Permit No.: 31652FP Priority Date: 06/01/39 Permit Location: SW 1/4 of the SE 1/4 of Section 33, T2N, R63W of the 6th P.M. Maximum Annual Volume of Appropriation: 267.0 Acre Feet . Maximum Pumping Rate: 650.0 Gallons Per Minute Maximum Number of Acres Which May be Irrigated: 320.0 32 EXHIBIT I -ASSIGNMENT ASSIGNMENT (Weld County) IN CONSIDERATION of Ten dollars ($10.00) and other good and valuable consideration,paid to RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, ("Assignor") by the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise("Assignee"),whose legal address is , the receipt whereof is hereby acknowledged, the Assignor has bargained, sold and assigned, and by these presents does assign, grant and convey to the Assignee and the Assignee's successors or assigns, all right, title and interest in the following: 1. The well permit associated with the well and water right described on the attached Exhibit A to this Assignment, together with rights associated with said well permits; • 2. A divided interest in the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV 1727, and recorded on June 22,2004 as Reception No. 20040622000516130 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22,2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder, to the extent said Findings of Fact, Conclusions of Law, Judgment and Decree of the Court pertain to the well and water right described on the attached Exhibit A to this Assignment; and 3. A divided interest in the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1, 2004 in Case No. 99CV0097, and recorded on June 22,2004 as Reception No. 20040622000516120 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder,to the extent said Findings of Fact, Conclusions of Law, Judgment and Decree of the Court pertain to the well and water right described on the attached Exhibit A to this Assignment. TO HAVE AND TO HOLD the same unto the Assignee, the Assignee's successors or assigns, forever. The Assignor and the Assignor's successors and assigns, covenant and agree with the Assignee and the Assignee's successors or assigns, to warrant and defend the sale of said property unto the Assignee and the Assignee's successors or assigns, against all and every person or persons whomever, claiming by, through or under the Assignor. 33 Signed this day of , 2006. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado By: Harvey E. Deutsch,President Attest: By: Steven H. Deutsch Title: Assistant Secretary STATE OF COLORADO ) ) ss. COUNTY OF The foregoing instrument was acknowledged before me this day of , 2006,by Harvey E. Deutsch as President and Steven H. Deutsch as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado. Witness my hand and official seal. My commission expires: Notary Public ACCEPTED AND AGREED TO THIS DAY OF , 2006. 34 TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise By: Mark D. Gray, Mayor ATTEST: Cheryl Jesser,Town Clerk STATE OF COLORADO ) ss. COUNTY OF WELD The foregoing instrument was acknowledged before me this day of , 2006,by Mark D. Gray as Mayor and by Cheryl Jesser as Town Clerk, of the TOWN OF KEENESURG. Witness my hand and official seal. My commission expires: Notary Public 35 Exhibit A to Assignment Permit No.: 31652FP Priority Date: 06/01/39 Permit Location: SW 1/4 of the SE 1/4 of Section 33,T2N, R63W of the 6th P.M. Maximum Annual Volume of Appropriation: 267.0 Acre Feet Maximum Pumping Rate: 650.0 Gallons Per Minute Maximum Number of Acres Which May be Irrigated: 320.0 36 EXHIBIT J—AGREEMENT Agreement This Agreement is entered into this day of , 2006 by and among the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise(collectively referred to as "Town"),RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, ("District"), and PV Water Holdings, LLC, a Colorado limited liability company("PV"), who may be referred to individually as a "party"and collectively as the"parties." RECITALS WHEREAS, the Town and the District have entered into an agreement which provides, among other things, for the Town to purchase the water right associated with Well Permit No. 31652-FP located in the Lost Creek Designated Ground Water Basin, and other interests associated with said water right; WHEREAS,the water right associated with Well Permit No. 31652-FP subject to the provisions of(1)Findings of Fact, Conclusions of Law,Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV1727, and recorded on June 22,2004 as Reception No. 20040622000516130 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder("Case No. 98CV1727 Decree"); (2)Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1, 2004 in Case No. 99CV97, and recorded on June 22,2004 as Reception No. 20040622000516120 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No.,3191504 of the books and records of the Weld County Clerk and Recorder("Case No. 99CV97 Decree"), and (3) Stipulations relating to the Case No. 98CV1727 Decree and the Case No. 99CV97 Decree that were entered into by and among Eagle Peak Farms, Ltd. and Prospect Valley Farms, Ltd., Sweetwater, L.L.C., and Lost Creek Ground Water Management District with an effective date of February 6, 2004 ("Stipulations")(The foregoing documents are collectively referred to as the"Decrees and Stipulations"); WHEREAS, the parties have agreed to terms and conditions regarding certain specified obligations regarding the Decrees and Stipulations. NOW, THEREFORE, in consideration of the mutual promises and agreements made herein, the receipt and value of which are expressly acknowledged, the parties hereby agree to the following terms and conditions: L Decrees and Stipulations. The Case No. 98CV1727 Decree, the Case No. 99CV97 Decree, and the Stipulations contain various terms and conditions regarding 37 the use of the water right associated with Well Permit No. 31652-FP. The Town agrees to comply with the terms and conditions of the Case No. 98CV 1727 Decree, the Case No. 99CV97 Decree, and the Stipulations except as the parties agree as follows: a. Paragraph 26.F. of the Case No. 98CV 1727 Decree and Case No. 99CV97 Decree provides, in part, that notice of the implementation of the change of use of the water right associated with Well Permit No. 31652-FP shall be provided to the Colorado Ground Water Commission ("Commission") and the Lost Creek Ground Water Management District ("Lost Creek District") by January 1 of the year in which the change of use shall apply. The parties agree that the Town shall provide such notices to the Colorado Ground Water Commission and the Lost Creek Ground Water Management District. In addition, said Paragraph 26.F. also refers to obtaining a contract with either the Commission, or the Lost Creek District, or a person or entity acceptable to the Commission which provides for reimbursement by the costs of administration. Pursuant to the Stipulations, the predecessor of the District agreed to enter into an agreement for such administration with the Lost Creek District. PV has provided to the Lost Creek District a proposed agreement for costs of administration and the District has not responded to the Agreement. PV and the Town agree that the Town shall be solely responsible for entering into an agreement for administration of the water right associated with Well Permit No. 31652-FP, and PV and the Town agree to work together in completing such agreement. b. Paragraph 26.N. of the Case No. 98CV1727 Decree and Case No. 99CV97 Decree provides, in part, that notice of change of ownership of the water right associated with Well Permit No. 31652-FP shall be filed with the Commission and the Lost Creek District. The Town agrees to provide the notice of change of ownership of the water right associated with Well Permit No. 31652-FP. c. Paragraph 23.c of the Stipulations provides for a payment to the Lost Creek District of the sum of$1000 in the first year that the water associated with the water rights that are the subject to the Case No. 98CV 1727 Decree and Case No. 99CV97 Decree are exported from the Lost Creek Designated Basin, and an equal payment for nine successive years. PV agrees to have the payments made as required by Paragraph 23.c of the Stipulations and to be solely responsible for the payments. d. Paragraph 23.e of the Stipulations provides for payment of Seventy-Five Thousand Dollars for a study regarding opportunities for water use and water management within the Lost Creek Designated Ground Water Basin and related areas, including, but not limited to, evaluation of aquifer characteristics, opportunities for above ground and underground storage of water, opportunities for groundwater recharge, and the logistics available or required to pursue such opportunities. The District has already paid the Seventy-Five Thousand Dollars to the Lost Creek District. The District hereby agrees to provide a copy of any results of the study to the Town. 2. Controlling Law and Venue. This Agreement shall be governed under and controlled pursuant to the laws of the State of Colorado, and the venue for any disputes hereunder shall be in the District Court, Weld County, State of Colorado. 38 3. Effective Date of Agreement. This Agreement shall be effective on the last date it is signed by all the parties. 4. Recording. This Agreement shall not be recorded at the office of the Weld County Clerk and Recorder. IN WITNESS HEREOF, the parties execute this Agreement effective as of the date set forth above. TOWN OF KEENESBURG, COLORADO, a Colorado municipal corporation, acting by and through its Water Activity Enterprise By Date: Mark D. Gray, Mayor ATTEST: Date: Cheryl Jesser,Town Clerk RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of . Colorado By: Harvey E.Deutsch Date: Name:_Harvey E. Deutsch Title:_President Attest: Steven H. Deutsch Date: Title: Assistant Secretary PV WATER HOLDINGS LLC, a Colorado limited liability company By: Joel H. Farkas, Manager 39 Date: 40 STATE OF COLORADO ) )ss. COUNTY OF The foregoing instrument was acknowledged before me this day of , 2006,by Mark D. Gray, as Mayor and by Cheryl Jesser, as Town Clerk of the Town of Keenesburg, Colorado, a Colorado municipal corporation acting by and through its Water Activity Enterprise. WITNESS my hand and official seal. My commission expires; Notary Public STATE OF COLORADO ) )ss. COUNTY OF WELD ) The foregoing instrument was acknowledged before me this day of , 2006,by Harvey E. Deutsch, as President and by Steven H. Deutsch, as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado,. WITNESS my hand and official seal. My commission expires; 41 STATE OF COLORADO ) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 2006,by Joel H. Farkas, as Manager of PV Water Holdings LLC, a Colorado limited liability company. WITNESS my hand and official seal. My commission expires; Notary Public 42 340 4 inlela &,,i r. cc 717.-b!(0& ASSIGNMENT IN CONSIDERATION of Ten dollars ($10.00) and other good and valuable consideration, paid to RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, ("Assignor") by the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise ("Assignee"), whose legal address is 140 South Main St., Keenesburg, Colorado 80643, the receipt whereof is hereby acknowledged, the Assignor has bargained, sold and assigned, and by these presents does assign, grant and convey to the Assignee and the Assignee's successors or assigns, all right, title and interest in the following: 1. The well permit associated with the well and water right described on the attached Exhibit A to this Assignment, together with rights associated with said well permit; 2. A divided interest in the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV1727, and recorded on June 22, 2004 as Reception No. 20040622000516130 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder, to the extent said Findings of Fact, Conclusions of Law, Judgment and Decree of the Court pertain to the well and water right described on the attached Exhibit A to this Assignment; and 3. A divided interest in the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1, 2004 in Case No. 99CV097, and recorded on June 22, 2004 as Reception No. 20040622000516120 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder, to the extent said Findings of Fact, Conclusions of Law, Judgment and Decree of the Court pertain to the well and water right described on the attached Exhibit A to this Assignment. TO HAVE AND TO HOLD the same unto the Assignee, the Assignee's successors or assigns, forever. The Assignor and the Assignor's successors and assigns, covenant and agree with the Assignee and the Assignee's successors or assigns, to warrant and defend the sale of said property unto the Assignee and the Assignee's successors or assigns, against all and every person or persons whomever, claiming by, through or under the Assignor. Signed this2.64day of July, 2006. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision o,, 'e State f Colorad By: Hpvey E. Deutsch, President Attest: By: Steven H. Deutsch, Assistant Secretary STATE OF COLORADO ss. CITY AND COUNTY OF DENVER ) The foregoing instrument was acknowledged before me this 25514lay of July, 2006, by Harvey E. Deutsch as President and Steven H. Deutsch as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado. Witness my hand and official seal. My commission expires: My Commission Expires May 19,2008 C Xfil PN NI. °, Notary ublic QTA I?tp ?. Q 7 PtJ5t.3t+ Q- ACCEPTED AND AGREED TO THIS; AAY OF JULY, 2006. TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise By: 61;2 Mayor L9. Gray, Mayor ATTEST: ( 2, it,,ALIA,4O/ Cheryl Jes er, TjnClerk STATE OF COLORADO ) ) ss. CITY AND COUNTY OF DENVER The foregoing instrument was acknowledged before me thisal4ay of T.` ' y 2006, by Mark D. Gray as Mayor and by Cheryl Jesser as Town Clerk, of the TO OF OF KEENESBURG, acting by and through its Water Activity Enterprise. Wig,_ .i�."G and official seal. O�, • t 800Z'61 hen saiidx3 uo:ssiwwo My et;• , a YV 4 is (2- p, 4,\ 1114: ?°( N4‘ OF COk" Notary u lb is %%4.......... Exhibit A to Assignment Permit No.: 31652FP Priority Date: 06/01/39 Permit Location: SW 1/4 of the SE 1/4 of Section 33. T2N, R63W of the 6th P.M. Maximum Annual Volume of Appropriation: 267.0 Acre Feet Maximum Pumping Rate: 650.0 Gallons Per Minute Maximum Number of Acres Which May be Irrigated: 320.0 Reek`_; WD . 34o;YcaeriAAS EASEMENT DEED u° G (Tank Site) THIS EASEMENT DEED is made and entered into as of the &Alay of July, 2006, by and between RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, hereinafter called "Grantor", and the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise, hereinafter called "Grantee," whose address is 140 South Main St., Keenesburg, Colorado 80643. WITNESSETH: For good and valuable consideration, the receipt whereof is hereby acknowledged, Grantor hereby grants to Grantee, it successors and assigns, an easement for the non-exclusive and permanent right to enter, re-enter, occupy and use the hereinafter described Property to construct, maintain, repair, replace, remove, enlarge and operate a water storage tank, water pipelines and all underground and surface facilities related thereto, including by example, but not by way of limitation, the following: electric or other control systems, underground cables, wires, equipment used in the delivery of water, connections, mains and conduits, valves, vaults, well housings ("Facilities"), access to, ingress and egress from the property with vehicles of any type or description and the like in, through, over and across the following described parcel of land situate, lying and being in the County of Weld and State of Colorado, to wit: Property described in Exhibit A, attached hereto and made a part hereof as if fully set forth herein. IT IS HEREBY MUTUALLY covenanted and agreed by and between the parties hereto as follows: With respect to easements on the Property described in Exhibit A that are used for access, ingress and egress, the Grantee shall have and exercise the right of access, ingress and egress in, to, over, through and across the Property described in Exhibit A for the full use of the easement provided for herein. With respect to easements on the Property described in Exhibit A that are used to construct, maintain, repair, replace, remove, enlarge and operate a water storage tank, Grantee may construct a permanent water storage tank on the surface of the easement, and may fence the easement and the Grantee shall have the exclusive use of the portion of the easement comprising the permanent water storage tank, and fenced area. With respect to easements on the Property described in Exhibit A that are used for water pipelines and all underground and surface facilities related thereto, including by example, but not by way of limitation, the following: electric or other control systems, underground cables, wires, equipment used in the delivery of water, connections, mains and conduits, valves, Grantee shall bury such structures at a depth of not less than four and one-half(4.5) feet and shall not fence that portion of the easement that includes the pipeline. Grantee shall have and exercise the right of subjacent and lateral support for the full and complete use of the easement. It is specifically agreed between the parties that the Grantor shall not knowingly take any action which would impair the earth cover over, or the lateral or subjacent support for, any water line or related Facilities within the easement, provided, however that upon obtaining the specific written permission of Grantee, the earth cover over any pipeline or lines may be modified; except that permission normally will not be granted for modification involving cover of less than four and one-half (4.5) feet, nor greater than ten (10) feet measured vertically from the top of any lines or Facilities. After construction, repair, replacement or enlargement of any lines or Facilities within the easement, the general surface of the ground shall be restored as nearly as reasonably can be done given the existence of these lines or Facilities to the grade and condition it was in immediately prior to construction. Topsoil shall be replaced in cultivated and agricultural areas, and any excess earth resulting from installation by Grantee shall be removed from the easement at the expense of Grantee. Grantee agrees that for a period of one year following construction which involves disturbance of the surface of the ground, Grantee will maintain the surface elevation by correcting any settling or subsiding that may occur as a result of the work done by Grantee within the easement. Grantor retains the right to the use and occupancy of the Property insofar as such use and occupancy is consistent with and does not impair Grantee's use of the easement. It is mutually agreed by and between the parties hereto that Grantee may commence the exercise of its rights to the use of the easement forthwith, or it may postpone the exercise of all or some part of its rights hereunder to some future time. Each and every one of the benefits and burdens of this Agreement shall inure to and be binding upon the respective legal representatives, successors and assigns of the parties hereto. In the event any party hereto or its successor or assign seeks to enforce its rights hereunder through litigation, arbitration or other administrative proceeding, the non- prevailing party shall be required to pay to the prevailing party as part of any judgment, order, or award reasonable attorney fees and costs. The Grantor reserves the right to grant further easement interests in the Property to other utilities and grantees provided that such further easement interests shall not interfere with or impair the easements granted to the Grantee planned Facilities. Unless special provisions are attached hereto, the above and foregoing constitute the whole agreement between the parties and no additional or different oral representation; promise or agreement shall be binding on any of the parties hereto, with respect to the subject matter of this Agreement. Grantor warrants the title to the easements against all persons claiming under the Grantor. IN WITNESS WHEREOF, the Grantor has executed this deed on the date set forth above. RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision o the State of Colorado '9 <2 By: / 7- .6-.\J uIJir'vey'E. Deutsch, President Attest: By: Steven H. Deutsch, Assistant Secretary STATE OF COLORADO ) ) ss. CITY AND COUNTY OF DENVER ) The foregoing instrument was acknowledged before me this day of July, 2006, by Harvey E. Deutsch as President and Steven H. Deutsch as Assistantsecretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation "^% y ubdivision of the State of Colorado. si.p.‘4 • GO '`‘ Witness y d and o i. Iv eal. i , oTARY i My co 1 •. ion ewpifes: o c, Commission Expires May 19,200 Ea 0i 1/V' •%. Notary blic ACCEPTED AND AGREED TO THIAY OF JULY, 2006. TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise �� hay,By: �G/L2 C// Mary D. Gray, Mayor i/... ATTEST: r ijY'i Z I b, eryl Jess r, To Clerk STATE OF COLORADO ss. CITY AND COUNTY OF DENVER The foregoing instrument was acknowledged before me this 1 'Aday of July. 2006, by Mark D. Gray as Mayor and by Cheryl Jesser as Town Clerk, of the TOWN OF KEENESBURG, acting by and through its Water Activity Enterprise. Witness my hand and official seal. My commission expires: 800?X61 ABA sandxj uoissiwwoo AA a kit/v.\ {fl � a M. GO?‘• Notary ublic i �yoTAe i i —m— I LA •BUG\ OF COs Exhibit A TANK SITE EASEMENT LEGAL DESCRIPTION: A 150-FOOT BY 150-FOOT TANK SITE EASEMENT OVER AND ACROSS THE FOLLOWING DESCRIBED TRACT OF LAND SAID TRACT BEING A PART OF THEE 1/2 OF THE SW 1/4 OF SECTION 33,TOWNSHIP 2 NORTH,RANGE 63 WEST OF THE 6T"P.M., COUNTY OF WELD, STATE OF COLORADO AND BEING MORE PARTICULARY DESCRIBED AS FOLLOWS: BASIS OF BEARING: CONSIDERING THE EAST LINE OF THE E 1/2 OF THE SW 1/4 OF SECTION 33,TOWNSHIP 2 NORTH,RANGE 63 WEST AS BEARING SOUTH 00°29'34"EAST AND WITH ALL OTHER BEARINGS CONTAINED HEREIN RELATIVE THERETO. COMMENCING AT THE SE CORNER OF THE SW 1/4 OF SECTION 33, TOWNSHIP 2 NORTH,RANGE 63 WEST; THENCE ALONG THE EAST LINE OF THEE 1/2 OF THE SW 1/4 OF SAID SECTION 33 N 00°29'34"W FOR A DISTANCE OF 30.00 FEET TO THE POINT OF BEGINNING; THENCE ALONG THE NORTH RIGHT-OF-WAY LINE OF WELD COUNTY ROAD 14,S 89°11'18"W FOR A DISTANCE OF 150.00 FEET; THENCE DEPARTING SAID NORTH RIGHT-OF-WAY LINE N 00°29'34" W FOR A DISTANCE OF 150:00 FEET; THENCE N 89°11'18"E FOR A DISTANCE OF 150.00 FEET TO A POINT ON THE EAST LINE OF THEE 1/2 OF SAID SW 1/4; THENCE ALONG SAID EAST LINE S 00°29'34"E FOR A DISTANCE OF 150.00 FEET TO THE POINT OF BEGINNING; CONTAINING A CALCULATED AREA OF 22,500 SQUARE FEET(0.52 ACRES) jQ 2430xc S4 S•24190 .2 /',///�/�/V,j, AA%)-% M G W r-�vp,=W ® 1° p o ��w z IA� = II W N W Nam O.�W c, O (n w o za= z Q ~ 0mal CID 00Q b0 co u W = xx2 0wu3ie �o O I_. X W62WU W0 I 0 (f) W In tl>- a Fe a u, =Wz�9, Git rWy<��w =o'o m I Y Cure co EN 0 3 .2 S0NIHV38 30 SISVS a I rive CC N01103S O ^ ti/L MS 3NIl 15V3 LS\11.\\zw 8dw t:i.i �/ ,66'bt9Z 3;,4L,6Z.00S O� bw'�1- ¢� d' NN UU Nbfn C Yl J J J ib W N:\ Caw -ll ^U M. r Z ,1/4 r� 7' W O Nw N W o NO !•y3 w � .. CO H — �F1�, ZF W t? N v tQ VI OZ V CD CI y .y-fra `-., "- 0o . r1 CD la coal Z CIO ld Cl-/err mmN�� C l O � � z t SLIM • W 0•. • M-M I["�Wq NU a m C d' W F W CO PC M M - CO W w M1 Z N �, - cv 1-J 00 rn 6 z m o z CD m Z V Z Z N M o c:24 O W . h C~ M co 0 0 0 0 0 1- 00000 N CO W F=- 0 0 0 O 0 1.--•.. W M [,J J ZMi[1 u] In in isi 00 Q O Fi C. a F cti \ O s us W W .47 CO JJJ JJ O��y co tn D 0 CC ?�G Z O up m oo 0 U y.0 oVU O rn -42 / U W M 0 Z U CO a P.-m 0 N/ ,LY-L49Z M,.ct.cc.00N = G 0 co CC NOLO3S 'b/l MS Z/I 3 '3NIl 1S3M I moo � sm AGREEMENT This Agreement is entered into thisj..aday of July, 2006 by and among the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise (collectively referred to as "Town"), RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, ("District"), and PV Water Holdings LLC, a Colorado limited liability company ("PV"), who may be referred to individually as a "party" and collectively as the "parties." RECITALS WHEREAS, the Town and the District have entered into an agreement which provides, among other things, for the Town to purchase the water right associated with Well Permit No. 31652-FP located in the Lost Creek Designated Ground Water Basin, and other interests associated with said water right; WHEREAS, the water right associated with Well Permit No. 31652-FP subject to the provisions of(1) Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV1727. and recorded on June 22, 2004 as Reception No. 20040622000516130 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder ("Case No. 98CV1727 Decree"); (2) Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1. 2004 in Case No. 99CV097, and recorded on June 22, 2004 as Reception No. 20040622000516120 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder ("Case No. 99CV097 Decree"), and (3) Stipulations relating to the Case No. 98CV 1727 Decree and the Case No. 99CV097 Decree that were entered into by and among Eagle Pealc Farms, Ltd. and Prospect Valley Farms, Ltd., Sweetwater, L.L.C., and Lost Creek Ground Water Management District with an effective date of February 6, 2004 ("Stipulations") (The foregoing documents are collectively referred to as the "Decrees and Stipulations"); WHEREAS, the parties have agreed to terms and conditions regarding certain specified obligations regarding the Decrees and Stipulations. NOW, THEREFORE, in consideration of the mutual promises and agreements made herein, the receipt and value of which are expressly acknowledged, the parties hereby agree to the following terms and conditions: 1. Decrees and Stipulations. The Case No. 98CV1727 Decree, the Case No. 99CV097 Decree, and the Stipulations contain various terms and conditions regarding the use of the water right associated with Well Permit No. 31652-FP. The 1 Town agrees to comply with the terms and conditions of the Case No. 98CV1727 Decree, the Case No. 99CV097 Decree, and the Stipulations except as the parties agree as follows: a. Paragraph 26.F. of the Case No. 98CV1727 Decree and Case No. 99CV097 Decree provides, in part, that notice of the implementation of the change of use of the water right associated with Well Permit No. 31652-FP shall be provided to the Colorado Ground Water Commission ("Commission") and the Lost Creek Ground Water Management District ("Lost Creek District") by January 1 of the year in which the change of use shall apply. The parties agree that the Town shall provide such notices to the Colorado Ground Water Commission and the Lost Creek Ground Water Management District. In addition, said Paragraph 26.F. also refers to obtaining a contract with either the Commission, or the Lost Creek District, or a person or entity acceptable to the Commission which provides for reimbursement of the costs of administration. Pursuant to the Stipulations, the predecessor of the District agreed to enter into an agreement for such administration with the Lost Creek District. PV has provided to the Lost Creek District a proposed agreement for costs of administration and the Lost Creek District has not responded to the Agreement. PV and the Town agree that the Town shall be solely responsible for entering into an agreement with the Lost Creek District for administration of the water right associated with Well Permit No. 31652-FP, and PV and the Town agree to work together in completing such agreement. b. Paragraph 26.N. of the Case No. 98CV1727 Decree and Case No. 99CV097 Decree provides, in part, that notice of change of ownership of the water right associated with Well Permit No. 31652-FP shall be filed with the Commission and the Lost Creek District. The Town agrees to provide the notice of change of ownership of the water right associated with Well Permit No. 31652-FP. c. Paragraph 23.c of the Stipulations provides for a payment to the Lost Creek District of the sum of$1000 in the first year that the water associated with the water rights that are the subject to the Case No. 98CV1727 Decree and Case No. 99CV097 Decree are exported from the Lost Creek Designated Basin, and an equal payment for nine successive years. PV agrees to have the payments made as required by Paragraph 23.c of the Stipulations and to be solely responsible for the payments. d. Paragraph 23.e of the Stipulations provides for payment of Seventy-Five Thousand Dollars for a study regarding opportunities for water use and water management within the Lost Creek Designated Ground Water Basin and related areas, including, but not limited to, evaluation of aquifer characteristics, opportunities for above ground and underground storage of water, opportunities for groundwater recharge, and the logistics available or required to pursue such opportunities. The District has already paid the Seventy-Five Thousand Dollars to the Lost Creek District. The District hereby agrees to provide a copy of any results of the study to the Town. 2. Controlling Law and Venue. This Agreement shall be governed under and controlled pursuant to the laws of the State of Colorado, and the venue for any disputes hereunder shall be in the District Court, Weld County, State of Colorado. 2 3. Effective Date of Agreement. This Agreement shall be effective on the last date it is signed by all the parties. 4. Recording. This Agreement shall not be recorded at the office of the Weld County Clerk and Recorder. IN WITNESS HEREOF, the parties execute this Agreement effective as of the date set forth above. TOWN OF KEENESBURG, COLORADO, a Colorado municipal corporation, acting by and through--77A,49:1----7 its Water Activity Enterprise By l F J(9 Date: 7c �O Mark Gray, Mayor ATTEST: TTSadt Date: -7 0 ��(r (fiery! Jester, t(wn Clerk RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal cornoy po litical olitical subdivision of the State of Colorado 7,// , � By: � � ,�—.- . !-'-..kf Date: (o [-0 Hervey/E. Deutsch, President Attest Steven H. Deutsch, Assistant Secretary PV WAT H LDINGS LLC, a Colorado limited liability company By: Date: (g /We /O4 Joel H. FFkas, Manager 3 STAIN OF COLORADO ) iss. CITY AND COUNTY OF DENVER ) The foregoing instrument was acknowledged before me this (p�'i day of July, 2006, by Mark D. Gray, as Mayor and by Cheryl Jesser, as Town Clerk of the Town of Keenesburg, Colorado, a Colorado municipal corporation acting by and through its Water Activity Enterprise. • •`r'+ SS �.0%, and official seal. • eco '61 Aryl sandx3 uoissiwwo 6W i M � -x.tes; y • r• _®— • .2 . / •• A PUBLIC Qi • •• sT • S Notary Public •� STATE 0'`�:..' 40 ) )ss. CITY AND COUNTY OF DENVER) The foregoing instrument was acknowledged before me this day of July, 2006, by Harvey E. Deutsch, as President and by Steven H. Deutsch, as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METRO'e.....,,A DISTRICT, a quasi-municipal corporation and political subdivision oft eMf .re.e O. O •• • i .�aa,J r rA'`iY % WITNESS m 64d and official seal, r v+ r My Commission Expires Ma y , r I1 7�}i y coms• :, rxpires; •• 7 tJ 4 L t c •• Te O . • •, OF CO\'� ��. - Notary Public STATE OF COLORADO ) )ss. CITY AND COUNTY OF DENVER) T�'Ir.l • !• ... trument was acknowledged before me this -25J,4ay of July, 2006, �' ' •. t .•.�4:•• s Manager of PV Water Holdings LLC, a Colorado limited liabil')' c• per}- 1. r • r ._ • • i TNNESS mtr h ,,u• d official seal. • V o i�sr• .;res: My Commission Expires May le ' • .•lk% •F •`i .��— Notary Public 4 3'4o54 7 l!JeE &a CO 71zi4* AGREEMENT This Agreement is entered into this2ay of ) Iy , 2006 between the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise, (collectively referred to as "Town") and RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado, ("District"), who may be referred to individually as a "party" and collectively as the "parties." RECITALS WHEREAS, the District has conveyed to the Town the water right associated with Well Permit No. 31652-FP located in the Lost Creek Designated Ground Water Basin, and other interests associated with said water right, as more particularly described on the attached Exhibit A; WHEREAS, pursuant to the conveyance to the Town of the water right associated with Well Permit No. 31652-FP, the District reserved the following; The District hereby reserves and retains the right to all water delivered pursuant to Well Permit No. 31652-FP that is not consumed and is available to be recaptured, reclaimed, reused or otherwise used after a first use of the water in an amount up to 77.7 acre feet per year. WHEREAS, the parties intend to define the terms and conditions for the District to use and reuse the water subject to the reservation. NOW, THEREFORE, in consideration of the mutual promises and agreements made herein, the receipt and value of which are expressly acknowledged, the parties hereby agree to the following terms and conditions: 1. Use of Water. The Town operates a water supply system that serves properties located both within and outside of the boundaries of the Town. The Town also operates a wastewater treatment facility, and any alternative, substitute or additional wastewater treatment facilities, which may be operated by the Town or may be operated by third parties (hereinafter collectively referred to as "Town Wastewater Treatment Facility"). The parties acknowledge and agree that the Town will make the first use of the water delivered pursuant to Well Permit No. 31652-FP as may be permitted by the terms and conditions of(1) the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV1727, and recorded on June 22, 2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder, and (2) Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1, 2004 in Case No. 99CV0097, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder. The amount of water monthly and annually delivered to the Town water system from the water associated with Well Permit No. 1 31652-FP shall be in the sole and exclusive discretion of the Town. The first use of the water delivered pursuant to Well Permit No. 31652-FP will be both within and outside of the boundaries of the Town (hereinafter referred to as the "Town's Service Area"). The District reserves and retains the right to all water delivered pursuant to Well Permit No. 31652-FP that is not consumed in the first use of the water and is available to be recaptured, reclaimed, reused or otherwise used after the first use of the water ("Recapture Water"). The amount of Recapture Water available after the first use of the water shall be determined pursuant to the following terms and conditions. 2. Determination of Recapture Water. The Town shall expressly retain dominion and control over the water delivered to customers of the Town within the Town's Service Area. In order to account for the portion of the water that may be considered Recapture Water, the parties agree to the following terms and conditions: a. The Town shall maintain records of daily average rate and daily volume of water delivered to the Town's water system pursuant to the water right associated with Well Permit No. 31652-FP. b. The Town shall maintain records of the daily average rate and daily volume of water delivered to the Town's water system from all sources, including the water delivered from the water right associated with Well Permit No. 31652-FP. c. The Town, or its designee, shall maintain records of the quantity of water discharged from the Town's Wastewater Treatment Facility. d. The quantity of water subject to the determination of Recapture Water shall be equal to the volume of water delivered to the Town's water system pursuant to the water right associated with Well Permit No. 31652- FP at any time and from time-to-time. Until, pursuant to paragraph 3 herein, such time as a court, or another entity with jurisdiction determines otherwise, the volume of Recapture Water (1) accruing to the alluvial aquifer from outdoor uses of the water, and (2) discharged from the Town's Wastewater Treatment Facility shall be (a) equal to the percentage of water delivered from the water right associated with Well Permit No. 31652-FP as compared with the total volume of water delivered to the Town's water system from all sources, and (b) calculated pursuant to the provisions of the following paragraphs. e. The net water consumption within the Town's service area during the months of December, January and February shall be equal to ten percent (10%) of the water delivered to the Town's water system pursuant to the water right associated with Well Permit No. 31652-FP during the months of December, January and February. The amount of Recapture Water shall be equal to ninety percent (90%) of the water delivered to the Town's water system pursuant to the water right associated with Well 2 Permit No. 31652-FP during the months of December, January and February, and shall be delivered to the District at the outfall of the Town's Wastewater Treatment Facility. f. The monthly volume of Recapture Water associated with indoor use of the water delivered during the months of March through November shall be equal to the average monthly volume of Recapture Water calculated for the previous December, January and February, and shall be delivered to the District at the outfall of the Town's Wastewater Treatment Facility. g. The monthly volume of Recapture Water associated with outdoor use of the water delivered pursuant to this Agreement during the months of March through November shall be determined by the following formula: Recapture Water equals [(total water delivery to the Town's water system from all sources during the month in acre feet minus the average monthly total water delivery to the Town from all sources during the previous December, January and February in acre feet) multiplied by (total water delivery to the Town's water system from the water right associated with Well Permit No. 31652-FP during the month in acre feet divided by total water delivery to the Town water system from all sources during the month in acre feet) multiplied by fifteen percent (15%)]. The Recapture Water associated with outdoor use will be available to the District as ground water return flows originating within the Town's Service Area. 3. Judicial or Other Approvals. The District shall be solely responsible for obtaining any decrees, permits or other approvals for use and reuse of the Recapture Water. In order to facilitate the proceedings pertaining to decrees, permits or other approvals for the use of the Recapture Water owned by the District, the Town agrees to provide to the District and its attorneys and agents, copies of documentation regarding the use of water within the Town's water supply system, including, but not limited to. the records of water deliveries and use maintained by the Town_ The parties further agree that no later than sixty (60) days prior to the District filing an application or request with an entity with jurisdiction to determine the amount of the Recapture Water discharged from the Town's Wastewater Treatment Facility and accruing to the ground water within the Town's Service Area, the District shall provide written notice to the Town of the District's intent to file an application or request. During the sixty (60) day period, the parties shall determine whether the parties could file a joint application or request for determination of the amount of reusable water, including Recapture Water, discharged from the Town's Wastewater Treatment Facility and accruing to the groundwater within the Town's Service Area. In the event the parties agree to file a joint application or request, the parties shall enter into a separate agreement which specifies the terms and conditions for the filing of the joint application or request. To the extent the procedures specified above for determining the Recapture Water portion of any water delivered to the Town's water system pursuant to the water right associated with Well Permit No. 31652-FP are defined by the District Court in and for Water Division No. 1, the Colorado Groundwater Commission. or any successor authority or entity with such jurisdiction, such determinations shall supercede the provisions specified in this Agreement. 3 4. Water Quality. The quality of the water discharged from the Town's Wastewater Treatment Facility shall comply with the then-existing discharge permit for the Town's Wastewater Treatment Facility's discharge within the Lost Creek watershed. The Town will have no obligation to provide additional treatment for the water discharged from the Town's Wastewater Treatment Facility. The District shall have no obligation to verify that the water discharged from the Town's Wastewater Treatment Facility is in compliance with any permits and the District shall have no liability for the quality of water discharged from the Town's Wastewater Treatment Facility. To the extent required for the District's use of the water discharged from the Town's Wastewater Treatment Facility (particularly if outside the Lost Creek Watershed for domestic or aquatic beneficial uses), the District shall provide any additional or supplemental water treatment and Town shall have no liability associated with the District's use of the Recapture Water. 5. Records. The Town will maintain the records described in this agreement and will provide copies of the records to the District from time-to-time or as requested by the District. 6. Easements. The parties acknowledge and agree that the District will need to construct pipelines, power lines, pumping stations and install other equipment to obtain delivery of the water discharged from the Town's Wastewater Treatment Facility. In order to facilitate the construction and installation of pipelines,power lines, pumping stations and other equipment, the Town agrees to grant temporary and permanent easements to the District on the land owned by the Town as may be required to construct, operate and maintain pipes and other facilities required to obtain delivery of the Recapture Water discharged from the Town's Wastewater Treatment Facility. At such time as the District may require easements on land owned by the Town, the District shall provide written notice to the Town and the written notice shall include a conceptual diagram of the location of the easement. Within thirty (30) days from the date of the written notice, representatives of the District and the Town shall meet to discuss the location of the proposed easement and terms and conditions for the use of the easement. After the parties have agreed to the location of the easement, the District, at its sole cost and expense, shall have a survey of the proposed easement completed by a licensed professional land surveyor. Upon completion of the survey, the Town shall grant to the District an Easement Deed in the form of Exhibit B. The District shall not pay any additional compensation to the Town for the easements granted pursuant to this paragraph. The Town shall have no obligation or responsibility to obtain or grant easements on land not owned by the Town. 7. Duplicate Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but which collectively shall be considered one Agreement. Each party represents that each has the right and authority to enter into this Agreement, and that all necessary board or council resolutions have been adopted. 8. Notices. Whenever any notice, demand. or request is required or provided for under this Agreement, such notice, demand, or request shall be provided in writing or by facsimile to the following addresses or such other addresses as may be designated by a party by notice. Notice shall be deemed received when: (I) personally delivered; or (2) when transmitted by facsimile; or (3) three (3) days after having been deposited in a U. S. Postal Service depository to be sent 4 by registered or certified mail, return receipt requested, with all required postage prepaid; or (4) one(1) business day after having been sent by overnight courier: To District: Resource Colorado Water and Sanitation Metropolitan District 141 Union Bld. #150 Lakewood, Colorado 80228 Copy to: Harvey E. Deutsch, President 9145 E. Kenyon Avenue, Suite 200 Denver, Colorado 80237 Facsimile: (303) 740-8657 And copy to: McGeady Sisneros, P.C. 1675 Broadway, Suite 2100 Denver, Colorado 80202 Facsimile: (303) 592-4385 To Keenesburg: Mark D. Gray Mayor Town of Keenesburg P. O. Box 312 Keenesburg, CO 80643 Facsimile: (303)732-0599 Copy to: Tad S. Foster P. O. Box 1836 Colorado Springs, CO 80901 9. Time is of the Essence. Time is of the essence with respect to each and every aspect of this Agreement, and strict compliance with all time requirements is at the heart of this Agreement and shall be strictly enforced. 10. Authority. The individuals executing this Agreement on behalf of their respective entities are authorized by the entities to execute this Agreement on behalf of their respective entities. 11. No Third-Party Beneficiary. This Agreement is entered into between the parties for the purposes set forth herein. No other person or entity is a beneficiary of this Agreement, nor shall any other person or entity be considered as a beneficiary, third party or otherwise, of this Agreement. 12. Default. The failure of a party to this Agreement to perform or observe of any of the covenants, terms, or conditions of this Agreement shall be subject to the following terms and conditions. 5 a. Any default resulting in a threat to public health, safety, or welfare shall be cured immediately by the defaulting party. As to any other default, a party who claims that another party has failed to perform as required by this Agreement shall provide written notice to the other party setting forth the specific failure complained of and shall provide that party a minimum of thirty (30) days within which to cure or within which to agree with the complaining party on a plan to cure the default. If the defaulting party does not cure within the time allowed, it shall be deemed to constitute an Event of Default. b. Upon the occurrence of an Event of Default, the non-defaulting party will have the right to enforce its rights under this Agreement and any applicable law by such suit, action, or special proceedings as the party deems appropriate including, without limitation, specific performance of any covenant in this agreement. Except as otherwise provided for herein, all rights and remedies of the parties may be exercised with or without notice, shall be cumulative, may be exercised separately, concurrently, or repeatedly, and the exercise of any such right or remedy shall not affect or impair the exercise of any other rights or remedy. c. The failure of a party to insist, on one or more occasions, upon the strict observation of any of the terms of this Agreement shall not be construed as a waiver or relinquishment in any future occasion of any of the terms of this Agreement. d. In the event of litigation arising out of this Agreement, prevailing party shall be entitled to all reasonable costs and expenses regarding such litigation, including, but not limited to, attorneys' fees. 13. Entire Agreement; Modifications. The making, execution and delivery of this Agreement by the Parties has not been induced by any representations, statements, warranties or agreements other than those expressed in this Agreement. This Agreement constitutes the entire understanding between the Parties, and all prior negotiations, agreements and understandings, written or oral, concerning the subject matter of this Agreement are considered superceded and merged herein. Modification of this Agreement by the Parties may be made only by a writing signed by the Party or Parties to be bound by the modification. 14. No Limitation on Sale or Agreements. By entering into this Agreement, neither the District nor the Town shall be limited or restricted from entering into other agreements or transactions for sale or lease of other water rights. 15. Controlling Law and Venue. This Agreement shall be governed under and controlled pursuant to the laws of the State of Colorado, and the venue for any disputes hereunder shall be in the District Court, Weld County, State of Colorado. 6 16. Effective Date of Agreement. This Agreement shall be effective on the last date it is signed by all the parties. 17. Recording. This Agreement shall be recorded at the office of the Weld County Clerk and Recorder. IN WITNESS HEREOF, the parties execute this Agreement effective as of the date set forth above. TOWN OF KEENESBURG, COLORADO, a Colorado municipal corporation acting 77:(77( byy and through its Water Activity Enterprise —7 By / `(72 (1 �� Date: /—,76 '� 6, Mark Gray, Mayor ATTEST: ?.PheJ Date: 7_T_ __ Cheryl Jess&, To Clerk RESOURCE,COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal cioration gad political subdivision of the State of Colorado By mgr: .C Ey, wai�'e Date: — [7 .Harvey E. Deutsch, President ATTEST: By: J Date: lq — O 6 Steven H. Deutsc , ssistant Secretary 7 STATE OF COLORADO ) )ss. COUNTY OF 1 1 r vt ) ) //� The foregoing instrument was acknowledged before me this�l,�4Riay of \_)L , 2006, by Mark D. Gray, as Mayor and by Cheryl Jesser, as Town Clerk of the Town of I Keenesburg, Colorado, a Colorado municipal corporation, acting by and through its Water Activity Enterprise. rif:W.�� and official seal. 'O'4$ i '�oTA!t?' . 800d'6l Awl saiidx3 uoissiwwoC.f � (My coraai�rission of,.es; W • i -y a'11 L1� e i f � OF CO�O' - S!1 Notary P blic STATE OF COLORADO ) )ss. COUNTY OF WELD The foregoing instrument was acknowledged before me this� �iay of �Jl y 2006,by Harvey E. Deutsch, as President and by Steven H. Deutsch, as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado. WITNESS my hand and official seal. My commission expires; My Commission Expires May 19,2008 M /4,y- „,-----y(O N tary ubli i I in is POBLV—; 4 F S, O Ir CO��: �.. . 8 EXHIBIT A - DESCRIPTION OF WATER RIGHT The following water right is subject to the terms and conditions of the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on May 10, 2004 in Case No. 98CV 1727, and recorded on June 22, 2004 as Reception No. 20040622000516130 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191505 of the books and records of the Weld County Clerk and Recorder; and the Findings of Fact, Conclusions of Law, Judgment and Decree of the Court entered by the Adams County District Court on June 1, 2004 in Case No. 99CV0097, and recorded on June 22, 2004 as Reception No. 20040622000516120 of the books and records of the Adams County Clerk and Recorder, and recorded on June 22, 2004 as Reception No. 3191504 of the books and records of the Weld County Clerk and Recorder, and is generally described as follows: PARCEL I-2 Final Permit No. 31652-FP issued for a well located in the SW1/4 of the SEI/4 of Section 33, Township 2 North, Range 63 West of the 6th Principal Meridian. Pursuant to the Decrees entered in Case Nos. 98CV1727 and 99CV097, the Original Permitted Appropriation, Allowable Annual Withdrawal (Allowable Appropriation in the following table), and Maximum Banking Reserve for the Changed Uses specified in the Decrees shall not exceed the following amounts: Original Permitted Parcel Well Permit Nos. Appropriation Allowable Maximum No. Appropriation Banking Reserve (acre-feet) (acre-feet) (acre-feet) I-2 31652-FP 267 139.6 382.2 9 EXHIBIT B FORM OF EASEMENT DEED THIS EASEMENT DEED is made and entered into as of the day of , 20 , by and between the TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise, hereinafter called "Grantor", and the RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado hereinafter called "Grantee," whose address is 141 Union Bld. #150, Lakewood, Colorado 80228. WITNESSETH: For good and valuable consideration, the receipt whereof is hereby acknowledged, Grantor hereby grants to Grantee, it successors and assigns, an Easement for temporary and permanent easements to the District on the land owned by the Town required to construct, operate and maintain pipes and other facilities required to obtain delivery of the Recapture Water discharged from the Town's Wastewater Treatment Facility ("Easement"), to enter, re-enter, occupy and use the hereinafter described Property to construct, maintain, repair, replace, remove, enlarge pipelines, power lines, pumping stations and install other equipment to obtain delivery of the water discharged from the Town's Wastewater Treatment Facility ("Facilities"), including by example, but not by way of limitation, the following: electric or other control systems, underground cables, wires, equipment used in the delivery of water, connections, mains and conduits, valves, vaults, access to, ingress and egress from the Property with vehicles of any type or description and the like in, through, over and across the following described parcel of land situate, lying and being in the Town of Keenesburg, County of Weld and State of Colorado, to wit: Property described in Exhibit A. attached hereto and made a part hereof as if fully set forth herein ("Property"). IT IS HEREBY MUTUALLY covenanted and agreed by and between the parties hereto as follows: With respect to Easement on the Property described in Exhibit A that are used for access, ingress and egress, the Grantee shall have and exercise the right of access, ingress and egress in, to, over, through and across the Property described in Exhibit A for the full use of the Easement provided for herein. With respect to Easement on the Property described in Exhibit A. that are used to construct, maintain repair, replace, remove, enlarge all water pipelines and all underground and surface facilities related thereto, including by example, but not by way of limitation, the following: electric or other control systems. underground cables, wires, equipment used in the delivery of water, connections, mains and conduits, valves, Grantee shall bury such structures at a depth of not less than four and one-half(4.5) feet and shall not fence the Easement. 10 Grantee shall have and exercise the right of subjacent and lateral support for the full and complete use of the Easement. It is specifically agreed between the parties that the Grantor shall take no action which would impair the earth cover over, or the lateral or subjacent support for, any water pipeline or related Facilities within the Easement, provided, however that upon obtaining the specific written permission of Grantee, the earth cover over any pipeline or lines may be modified; except that permission normally will not be granted for modification involving cover of less than four and one-half (4.5) feet, nor greater than ten (10) feet measured vertically from the top of any lines or Facilities. After construction, repair, replacement or enlargement of any pipelines or Facilities within the Easement, the general surface of the ground shall be restored as nearly as reasonably can be done given the existence of these pipelines or Facilities to the grade and condition it was in immediately prior to construction. Topsoil shall be replaced and any excess earth resulting from installation by Grantee shall be removed from the Easement at the expense of Grantee. Grantee agrees that for a period of one year following construction which involves disturbance of the surface of the ground, Grantee will maintain the surface elevation by correcting any settling or subsiding that may occur as a result of the work done by Grantee within the Easement. Grantor retains the right to the use and occupancy of the Property insofar as such use and occupancy is consistent with and does not impair Grantee's use of the Easement. It is mutually agreed by and between the parties hereto that Grantee may commence the exercise of its rights to the use of the Easement forthwith, or it may postpone the exercise of all or some part of its rights hereunder to some future time. Each and every one of the benefits and burdens of this Agreement shall inure to and be binding upon the respective legal representatives, successors and assigns of the parties hereto. In the event any party hereto or its successor or assign seeks to enforce its rights hereunder through litigation, arbitration or other administrative proceeding, the non- prevailing party shall be required to pay to the prevailing party as part of any judgment, order, or award reasonable attorney fees and costs. The Grantor reserves the right to grant further easement interests in the Property to other utilities and grantees provided that such further easement interests shall not interfere with or impair the easements granted to the Grantee planned Facilities. Unless special provisions are attached hereto, the above and foregoing constitute the whole agreement between the parties and no additional or different oral representation; promise or agreement shall be binding on any of the parties hereto, with respect to the subject matter of this Agreement. Grantor warrants the title to the easements against all persons claiming under the Grantor. 11 IN WITNESS WHEREOF, the Grantor has executed this deed on the date set forth above. TOWN OF KEENESBURG, COLORADO, acting by and through its Water Activity Enterprise By: Mark D. Gray, Mayor ATTEST: Cheryl Jesser, Town Clerk STATE OF COLORADO ) ss. COUNTY OF WELD The foregoing instrument was acknowledged before me this day of , 20 , by Mark D. Gray as Mayor and by Cheryl Jesser as Town Clerk, of the TOWN OF KEENESBURG, acting by and through its Water Activity Enterprise. Witness my hand and official seal. My commission expires: Notary Public ACCEPTED AND AGREED TO THIS DAY OF , 20 RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado By: Harvey E. Deutsch, President 12 Attest: By: Steven H. Deutsch, Assistant Secretary STATE OF COLORADO ) ss. CITY COUNTY OF DENVER ) The foregoing instrument was acknowledged before me this day of 20 , by Harvey E. Deutsch as President and Steven H. Deutsch as Assistant Secretary of RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado. Witness my hand and official seal. My commission expires: Notary Public 13 Exhibit A Legal Description 14 " EXHIBIT F Schedule and Locations of Regular Board Meetings {00I03624.DOC v:3} F-1 PUBLIC NOTICE OFt2007 REGULAR MEETINGS OF THE BOARD OF DIRECTORS OF THE RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT PUBLIC NOTICE is hereby given that the regular meetings of the Board of Directors of the Resource Colorado Water and Sanitation Metropolitan District, of Weld County, State of Colorado, shall be held on the second Wednesday of each month at 10 : 00 a.m. , at the offices of Centricom, LLC, 9145 East Kenyon Avenue, First Floor Conference Room, Denver, Colorado. At such meetings, the Board shall conduct the regular business of the District and other business which may come before the Board. All meetings shall be open to the public . IN WITNESS WHEREOF, this notice is given and duly posted pursuant to statute this 4th day of January, 2007 . RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT By /s/ Jean M. Gold Secretary to the Board Kilt ‘te- :" Memorandum Date: September 5, 2007 To: Board of County Commissioners lID From: Monica Daniels-Mika Subject: Resource Colorado—Water and O Sanitation Metropolitan District • COLORADO On August 13, 2007, the Board of County Commissioners was presented with the yearly update to the Resource Colorado Water and Sanitation Metropolitan District plan. At this time, Exhibit D Current Rules and Regulations were not included. Attached, pleased find a copy of this Exhibit. Staff has reviewed this information and finds it to be incompliance with Weld County Code Section 2-14-20 Service Plan. 2007/memo/reso urceco loradoehxi b itd g0041:0 ,o 9-/D-o2017 aO7 -271v0 vJJ - V l I LJ� RULES AND REGULATIONS OF THE RESOURCE COLORADO WATER AND SANITATION METROPOLITAN DISTRICT The Board of Directors of the Resource Colorado Water and Sanitation Metropolitan District("District") hereby declares that the following Rules and Regulations have been prepared and adopted to provide for the construction, administration and operation of the District's public Water and Wastewater Systems (as defined herein). These Rules and Regulations, or any amendment thereto, shall be effective as of the effective date set forth below upon adoption of a resolution by a majority of the Board of Directors of the District at a public meeting approving these Rules and Regulations. The Board of Directors of the District hereby expressly reserves the right to make any lawful addition and/or revisions in these Rules and Regulations when and as they may become advisable to properly manage the District and to promote the peace, health, safety and welfare of the inhabitants of the Service Providers that will be served by the District. These Rules and Regulations are supplementary to, and are not to be construed as, any abridgement of any lawful rights of the Board of Directors of the District as outlined in the Colorado Revised Statutes governing Special Districts, including the right to disconnect or to refuse permission to connect any Service Provider to the District's Water or Wastewater System for violation of these Rules and Regulations or any other applicable law of the State of Colorado. RESOURCE COLORADO WATER AND SANITATION METROP N DISTRICT By: Chris R. Paulson, President Attest: By: C9-44 I) Q ViCID Name: Tern i ereCL) Title: 1\cc,* . SoCieu r‘i ADOPTED EFFECTIVE JULY 18,2005 LAST AMENDED EFFECTIVE APRIL 11,2007 100096389.DOC v:1) TABLE OF CONTENTS ARTICLE 1. GENERAL PROVISIONS 1 1.1 General 1 1.1.1 Authority 1 1.1.2 Scope 1 1.1.3 Policy 1 1.1.4 Purpose 1 1.1.5 Service Plan Limitations 1 1.1.6 Initial Service Area 1 1.1.7 Enterprises and Authorities 2 1.2 Construction of Rules and Regulations. 2 1.2.1 Intent of Construction 2 1.2.2 Incorporation of Decrees and Rules and Regulations by Other Governmental Entities: 2 1.2.3 Amendment 3 1.2.4 Conflict 3 1.2.5 Severability 3 1.2.6 Modification, Waiver and Suspension of Rules 3 1.2.7 Saving Provision 3 1.2.8 Repeal of Conflicting Resolutions 3 1.3 District Facilities 3 1.3.1 Ownership and Maintenance of District Facilities 3 1.3.2 Service Provider System Compliance with Design Standards 4 1.3.3 Encroachment of the District's Easements 4 1.3.4 Use of District's Easements 4 1.3.5 Non-District Water Wells Prohibited 4 1.4 Inspections 4 1.4.1 Powers and Authority of District 4 1.4.2 Construction Inspection 5 1.5 Protection of District Facilities 5 1.5.1 Compliance with Statutes and Regulations 5 1.5.2 Locate Information 5 1.6 Definitions. 5 1.6.1 Definitions for Water and Wastewater Systems 5 ARTICLE 2. REQUIREMENTS FOR ACQUIRING WATER OR WASTEWATER SERVICE FROM THE DISTRICT 13 2.1 Water or Wastewater Service. 13 2.1.1 Policy 13 2.1.2 No Obligation of Service 13 2.1.3 Revocation of Service 13 2.1.4 Covenants 13 2.1.5 Contracts and Agreements 13 2.1.6 Denial of Service 14 2.1.7 Application for System Review 14 Other Conditions for Service 15 {00096389.DOC v:1} 1 2.1.9 Districtl6 2.1.10 Procedural Requirements for Acquiring Water or Wastewater Service: 17 2.2 Fees, Rates and Service Charges. 17 2.2.1 Policy. 17 2.2.2 Payment of Fees 17 2.2.3 Schedule and Types of Fees, Rates and Service Charges: 17 2.2.4 Billing Procedures for Service Charges 18 ARTICLE 3. WATER SERVICE 19 3.1 Principles for Supplying Water Resources to Public Water Service Providers 19 3.1.1 Policy Regarding Use of District Water System 19 3.1.2 Water Policy 19 3.1.3 Scope of District Water Supply 19 3.1.4 Ownership of Water and Return Flows 19 3.1.5 Consent to Groundwater Appropriation 19 3.2 District Water System and Service Provider Systems 20 3.2.1 Ownership and Maintenance of Service Provider Water Service Facilities and Lines 20 3.2.2 Ownership and Maintenance of Master Water Meters and Related District Facilities: 20 3.2.3 Non-Potable Irrigation System 20 3.3 Protection of District Water Supply. 20 3.3.1 Limitations to Protect District Water Supply 20 3.3.2 Additional Provisions 21 3.3.3 Enforcement 21 3.3.4 Prohibitions 21 3.3.5 Violations 21 ARTICLE 4. WATER CONSERVATION 21 4.1 Compliance with State Laws 21 4.2 Development and Implementation of Water Conservation Programs 21 4.2.1 Leak Detection 21 ARTICLE 5. WATER QUALITY 22 5.1 Monitoring Water Quality 22 5.2 Commingling of Water Supplies 22 5.2.1 Standards 22 ARTICLE 6. PROVISIONS FOR WASTEWATER SERVICE 22 6.1 General 22 6.1.1 Policy 22 6.1.2 Service Area 22 6.1.3 Request for Approval from an Existing Service Provider 22 6.1.4 Request for Approval from a New Service Provider 23 6.1.5 Service Area Information 24 6.1.6 Approval Procedures 24 6.1.7 Post-treatment Waters 24 {00096389.DOC v:I} 11 6.1.8 Prohibited Wastes 24 6.1.9 General Prohibition 24 6.1.10 Construction Modifications to Limit Harmful Waste 25 6.1.11 Lateral Size 25 6.1.12 Maintenance of Laterals 25 ARTICLE 7. LIMITATIONS ON DISCHARGE 25 7.1 Limitations On Discharged Wastes/Prohibited Wastes 25 7.1.1 Standards for Water or Wastewater Discharge into the District's Wastewater System 25 7.1.2 Construction Modifications to Limit the Discharge of Harmful Wastes into the District Facilities, Grease Interceptors/Traps and Sand/Oil Interceptors/Traps 26 7.1.3 Review of Plans for the Construction and Installation of Pretreatment Facilities: 26 7.1.4 Sampling Manholes 26 7.1.5 Interceptor/Trap Maintenance: 26 7.1.6 Interceptor/Trap Requirements for Existing Property/District Facilities 26 7.1.7 Construction Modifications to Limit Harmful Wastes, Wash Racks/Floor Slabs 27 ARTICLE 8. PRETREATMENT REQUIREMENTS 27 8.1 General 27 8.1.1 Authority 27 8.1.2 Compliance 27 8.2 Applicability. 28 8.3 Compliance With Requirements 28 8.4 Legal Authority Requirements. 28 8.5 Program Procedure Requirements. 28 8.5.1 Industrial Waste Survey 28 8.6 Extra-Jurisdictional Industrial Users. 28 8.7 Exemptions. 28 8.8 Program Review. 29 8.9 Remedies 29 8.9.1 Emergency Remedies 29 8.9.2 Routine Remedies 29 8.10 Program Preemption. 29 8.11 Program Delegation. 29 8.12 District Monitoring. 29 8.13 General Requirements Regarding Deleterious Wastes 30 8.14 Prohibited Discharges 31 8.15 Specific Discharge Limitations—Service Providers. 33 8.16 Applicability. 34 8.17 General Discharge Prohibitions 34 8.18 Specific Discharge Limitations—Users. 34 8.18.1 District Limitations 34 8.18.2 National Categorical Pretreatment Standards 35 {00096389.DOC v:1) 111 8.18.3 State Requirements 35 8.18.4 Dilution Prohibited 35 8.19 Insignificant Discharges. 35 8.20 Accidental Or Unusual Discharges 35 8.20.1 Accidental Discharge Protection 35 8.20.2 Notification Requirements. 35 8.20.3 Slug Discharge Plan Requirements 36 8.21 8.21 Hazardous Waste Discharge Notification 36 8.22 Wastewater Contribution Permits 36 8.23 Reporting Requirements For Significant Industrial Users 36 8.24 Monitoring District Facilities. 36 8.25 Information Submittal, Inspection and Sampling 37 8.26 Wastewater Treatment 37 8.27 Confidential Information. 37 8.28 Remedies For Noncompliance; Enforcement 38 8.28.1 Notice of Violation 38 8.28.2 Administrative Orders 38 8.28.3 Compliance Orders; Compliance Schedules 38 8.28.4 Suspension of Service 39 8.28.5 Permit Revocation 39 8.28.6 Penalties 39 8.28.7 Legal Action 40 8.28.8 Appeal and Hearing Procedure 40 8.29 Charges and Fees. 40 ARTICLE 9. CROSS-CONNECTION CONTROL AND BACKFLOW CONTROL POLICY AND REGULATIONS 40 9.1 General 40 9.1.1 Policy 40 9.1.2 Responsibility 40 9.1.3 Service Provider Requirements 41 9.1.4 Every Service Provider shall adopt policies and regulations for cross- connection control and backflow control sufficient to: 41 ARTICLE 10. MISCELLANEOUS 41 10.1 Liability: 41 10.1.1 District Not Liable 41 10.1.2 District Not Responsible for Damages 42 10.1.3 Officials Not Liable 42 10.1.4 Non-Liability for Work of Others 42 10.1.5 Indemnity 42 10.1.6 Non-Waiver 42 10.1.7 Notices and Written Submissions 42 ARTICLE 11. PROVISIONS REGARDING MOSQUITO CONTROL SERVICES 43 ARTICLE 12. PROVISIONS REGARDING STREET IMPROVEMENTS 43 {00096389.DOC v:1) lv ARTICLE 13. PROVISIONS REGARDING EMPLOYEE AND PERSONNEL MATTERS ...43 PRE-CAST CONCRETE INTERCEPTORS 6 MANHOLE RINGS AND COVERS 6 PRE-CAST CONCRETE INTERCEPTORS 12 MANHOLE RINGS AND COVERS 12 {00096389.DOC v:1} V EXHIBITS EXHIBIT A Schedule of Fees, Rates and Charges [Reserved] EXHIBIT B Connector Agreement for Wastewater Service [Reserved] EXHIBIT C Pretreatment Discharge Standard to Limit the Discharge of Harmful Wastes into the District's Facilities EXHIBIT D District Design Standards and Standards and Requirements for Service Providers [Reserved] EXHIBIT E Standards for Cross-Connection Control and Backflow Control Policy and Regulations (00096389.DOC v:1) V1 ARTICLE 1. GENERAL PROVISIONS 1.1 General. 1.1.1 Authority: These Rules and Regulations are adopted in accordance with the authority conferred in Title 32,Article 1, and other provisions of the Colorado Revised Statutes, by the Resource Colorado Water and Sanitation Metropolitan District Board of Directors. The District is a political subdivision of the State of Colorado and a quasi-municipal corporation with all the powers thereof which are specifically granted to the District, or are necessary or incidental to or implied from powers specifically granted by statute, constitution or other law, for carrying out the objectives and purposes of the District. 1.1.2 Scope: These Rules and Regulations have been adopted and promulgated pursuant to C.R.S. §32-1-1001(1)(m) and shall be considered a comprehensive set of Rules and Regulations governing the operations and functions of the District as of the effective date stated herein. The District has the authority to implement the Rules and Regulations provided herein by policies and resolutions. The Board reserves the right to make rulings and adopt resolutions concerning matters not covered herein as and when appropriate in the opinion of the Board. 1.1.3 Policy.: It is hereby declared that the Rules and Regulations hereinafter set forth will serve a public use and are necessary to insure and protect the health, safety, prosperity, security, and general welfare of the service users of the District. 1.1.4 Purpose: The purpose of these Rules and Regulations is to provide for the orderly financing, control,management and operation of the Water and Wastewater Systems of the District, including additions, extensions and connections thereto, and to provide for the administration and enforcement of standards to promote the health, safety and general welfare of Customers of Service Providers or other service users of the District. Provision of water and sanitation services by the District will be available only in accordance with these Rules and Regulations. 1.1.5 Service Plan Limitations: The District's Service Plan prohibits the District from providing water or wastewater service directly to individual customers without amending the District's Service Plan. The District is empowered by C.R.S. §32-1-1001(1)(d)(I) and by Colorado law to enter into contracts and agreements affecting the affairs of the District. The District intends to enter into Agreements with water and wastewater Service Providers for the provision of water or wastewater services as set forth in these Rules and Regulations. Such Agreements may require Service Providers to satisfy certain other conditions prior to obtaining service from the District. The District's provision of water and/or wastewater services to Service Providers is contingent upon the District having an adequate Water Supply and that the District Facilities are adequate. Because of these limitations, the District cannot guarantee that it will be able to provide water and sanitation service to Service Providers or properties even if they are within the District's Service Area. 1.1.6 Initial Service Area: The initial Service Area consists of underserved areas within Adams and Weld County including the Cities of Brighton or Commerce City or {00096389.DOC v:1} other Service Providers. The District, through Agreements, will supply water or provide wastewater services to Service Providers for service to their Customers through their systems. The Service Area may be expanded to serve other properties, through Agreements with Service Providers, as demand for service and resources to provide such services are available. 1.1.7 Enterprises and Authorities: The provision of water, sanitation and storm drainage services for the use and benefit of Service Providers shall be through the creation of enterprises and/or authorities which will be authorized to collect rates, fees,tolls and charges for connection to and use of the District Facilities and the provision of service. Such service shall be subject to any capacity limitations and provisions for the operation, maintenance, repair and replacement of all District Facilities owned by the District, in accordance with these Rules and Regulations. 1.2 Construction of Rules and Regulations. 1.2.1 Intent of Construction: It is intended that these Rules and Regulations shall be liberally construed to affect the general purposes set forth herein, and that each and every part thereof is separate and distinct from all other parts. No omission or additional material set forth in these Rules and Regulations shall be construed as an alteration, waiver, or deviation from any grant of power, duty or responsibility, limitation or restriction, imposed or conferred upon the Board by virtue of statutes now existing or subsequently amended or adopted, or under any Agreement existing between the District and any other private or governmental entity or Service Provider. Nothing contained herein shall be so construed as to prejudice or affect the right of the District to secure the full benefit and protection of any law which is now enacted or may subsequently be enacted by the Colorado General Assembly pertaining to the governmental or proprietary affairs of the District. 1.2.2 Incorporation of Decrees and Rules and Regulations by Other Governmental Entities: (a) General: Any limitations, restrictions or prohibitions validly placed upon the District or the water rights comprising the District's Water Supply by any governmental entity or by any Agreement to which the District is a party, are hereby incorporated into these Rules and Regulations by this reference and shall constitute a limitation, restriction and/or prohibition on the District's ability to provide service to Service Providers and on each Service Provider that shall contract with the District for the supply of water or wastewater service. (b) Water: The provision of water service by the District may be governed by and subject to court decrees, stipulations, or other court orders or decrees, including any subsequent court orders concerning the water to be supplied through service or delivery agreements by the District to Service Providers. The District acknowledges that water sources also may be limited by all applicable laws, rules and regulations governing the withdrawal of groundwater, including but not limited to,the Ground Water Management Act, §37-90-101 et seq. the Rules and Regulations for the Management and Control of Designated Ground Water, 2 C.C.R. 410-1, and the Regulations for the Use, Control and Conservation of Ground Water {00096389.DOC v:1) 2 Within the Lost Creek Ground Water Management District, laws and regulations governing water quality, and all other applicable laws and regulations, as now or hereafter constituted. 1.2.3 Amendment: It is specifically acknowledged that the District shall retain the power to amend these Rules and Regulations as it deems appropriate and such amendments shall be entered in the Minutes of the District and periodically incorporated in printed copies of these Rules and Regulations. Prior notice of these amendments shall not be required to be provided by the District exercising its amendment powers pursuant to this Article. 1.2.4 Conflict: In the event of a conflict between these Rules and Regulations and specific terms or conditions of any Agreement entered into between the District and any party,these Rules and Regulations shall control. 1.2.5 Severability: If any provision of these Rules and Regulations, or its application to any person or circumstances is held invalid, the application of such provision to other persons or circumstances, and the validity, enforceability or legality of the remainder of these Rules and Regulations, shall not be affected thereby. 1.2.6 Modification, Waiver and Suspension of Rules: The Board of Directors or the District Manager, acting on prior written instructions of the Board, shall have the sole authority to waive, suspend or modify the application of these Rules and Regulations, and any such waiver, suspension or modification must be in writing, signed by the Board or the District Manager and shall not be deemed an amendment of the Rules and Regulations. No waiver, suspension or modification on any one occasion shall constitute a waiver, suspension or modification on any subsequent or other occasion. 1.2.7 Saving Provision: The enactment of these Rules and Regulations, any amendment thereof, or the repeal of any prior existing Rules and Regulations or resolutions shall not deny or limit any right, action, cause of action, penalty charge or fee which arose under such provision. 1.2.8 Repeal of Conflicting Resolutions: All resolutions or parts of resolutions in conflict herewith as of the effective date hereof, are hereby repealed, except as may be expressly provided herein. 1.3 District Facilities. 1.3.1 Ownership and Maintenance of District Facilities: Except as otherwise provided in these Rules and Regulations, it is the policy of the District that all District Facilities forming an integral part of the District's Water and Wastewater Systems are the property of the District upon acceptance by the District regardless of whether such Facilities are constructed, financed, or paid for by the District or by other Persons. The District shall be responsible for maintenance, repair and reconstruction of such Facilities and all appurtenances thereto, at the cost of the District,unless the District Facility is under warranty in which case the warranty provisions shall apply to the fullest extent provided by law. No other Persons, except those authorized by the District, shall have any right to enter upon, inspect, operate, adjust, change, alter, move or relocate any portion of the District Facilities. {00096389.DOC v:1) 3 1.3.2 Service Provider System Compliance with Design Standards: [Reserved]. 1.3.3 Encroachment of the District's Easements: No Person, including but not limited to, Service Providers with whom the District has a Contract shall construct any temporary or permanent building or other similar structure, place any fill material on, or otherwise encroach upon any of the District's easements. 1.3.4 Use of District's Easements: A Service Provider, property owner, developer or contractor may request permission from the District to share or use the District's easements for the installation of drains,pipelines or other facilities necessary to utilize the District Facilities. The District's determination to allow a Service Provider, property owner, developer or contractor to share or use the District's easements shall be made in the sole discretion of the District. Any such approval shall be in the form of a written agreement,which shall set forth fully the terms of the agreement, specifically including, but not limited to,the terms set forth below: (a) Any such agreement shall be subject to Board approval after a public meeting therefore. (b) The property owner, developer or contractor shall, at all times, have the obligation, enforceable at the demand of the District,to construct, operate, maintain, repair and replace any non-District owned facilities as may be desirable from time-to-time. (c) The Service Provider, developer or contractor shall agree to indemnify and save the District, its officers, directors, agents and employees harmless from and against every claim, demand, liability, cost, charge, suit,judgment and expense of whatsoever kind or nature, including, but not limited to, interest, court costs and attorneys fees which the District, its officers, directors, agents or employees may pay or incur by reason of or which in any way arise out of the sharing or using of the District's easements by the property owner, developer or contractor. Said indemnification shall extend to claims, demands and liability or injury to persons and property and financial loss which incur off the job site as well as on, and for injury and damage to person and property and financial loss occurring after construction and installation of the non-District owned facilities within the District's easements by the property owner, contractor or developer. 1.3.5 Non-District Water Wells Prohibited: In an effort to coordinate the provision of water services as contemplated in the District's Service Plan, only those wells forming part of the District's Water Supply may connect to the District's Water System. Service Providers that have a Service Agreement with the District shall not act to impair the District's water rights or water quality. The District is not responsible for the augmentation of any wells within the District's Service Area other than those owned by the District, except by separate Agreement. 1.4 Inspections. 1.4.1 Powers and Authority of District: The District Manager or representative or their designee bearing proper credentials and identification shall be permitted to enter all property of the Service Provider necessary for the purposes of reading meters, testing related to (00096389.DOC v:1) 4 discharge(s)to the Water or Wastewater Systems, inspection, observation,measurement, sampling,repair,maintenance of any portion of the District Facilities lying within said properties and related matters, upon reasonable notice to the Service Provider, except in the case of an emergency in which case prior notice is not required. 1.4.2 Construction Inspection: The District Manager,representative or their designee shall have the right to inspect any and all work during construction of any Service Provider facilities necessary to receive water or wastewater service from the District,to ensure installation in accordance with District standards. After completion of construction the District Manager and/or his representative shall make a final inspection of construction prior to commencement of service. 1.5 Protection of District Facilities. 1.5.1 Compliance with Statutes and Regulations: For all projects that require digging,boring, directional drilling or excavation in or around District Facilities, the person, contractor or excavator wishing to dig or excavate around said District Facilities shall comply with all applicable statutes and regulations of the State of Colorado. 1.5.2 Locate Information: For projects that require digging, boring, directional drilling or excavation around District Water System facilities, a contractor or excavator must provide location information to the District and must comply with all other District requirements for notification and processing prior to commencing any digging, boring, directional drilling or excavation. 1.6 Definitions. 1.6.1 Defmitions for Water and Wastewater Systems: Unless the context specifically indicates otherwise, the meaning of the terms used herein shall be applicable to these Rules and Regulations. (a) Agreement or Agreements: Any Board approved Water Delivery Agreement,Water Resource Agreement, Connector Agreement and/or any other contract or agreement necessary to the provision of water or wastewater service to Service Providers, together or referred to separately herein. (b) Annual Charges or Annual Charges for Service: The sums paid or becoming payable to the District pursuant to a Connectors Agreement and pursuant to any agreement supplemental thereto. (c) Applicant: The Service Provider entering into a contract with the District for new or additional water or sanitation service. (d) Application Fee: The fee charged by the District that is intended to cover the Costs incurred by the District in evaluating a Water Delivery Agreement or Connector Agreement. {00096389.DOC v:1) 5 (e) Board or Board of Directors: The duly elected Board of Directors of the District, which acts as the governing body of the District. (f) BOD5 (5-Day Biochemical Oxygen Demand): The quantity of dissolved oxygen, expressed in parts per million by weight,required by aerobic biological action under standard laboratory procedure in five days at 20°C. (g) Capital Improvement Plans: Shall refer to the District's Water or Wastewater Facilities Capital Improvements Plans. (h) Categorical Standards or National Categorical Pretreatment Standards or Pretreatment Standards: Any regulation containing pollutant discharge limits promulgated by the EPA in accordance with Articles 307(b) and(c) of the Clean Water Act(33 U.S.C. §1317 et seq.)which applies to a specific category of Industrial Users. (i) Clean Water Act: The Federal Water Pollution Control Act, as amended, 33 U.S.C. §1251, et Ng.. (j) Connector Agreement: A contract between the District and a Service Provider for the District to provide wastewater services to a Service Provider in accordance with these Rules and Regulations. (k) Cost(s): All direct costs applicable to the construction, reconstruction, enlargement or dedication of a given District Facility, including but not limited to, costs associated with planning, design,preliminary and design engineering, construction, inspection, administration, acquisition, or dedication of District Facilities, acquisition of all required rights-of-way, acquisition of water rights, depreciation, attorney fees,regulatory agency fees,plan approval fees, "as built" drawings, and all other fees and/or costs necessary to provide new, different or additional water or wastewater service. (1) Customer: Any person, company, corporation, public entity or authority, developer,property owner, lessee, tenant or occupant of such property owner, or visitor of any of the foregoing,who is supplied with or uses water or sanitation service furnished by any Service Provider. (m) Deleterious Wastes: Any wastes contained in sewage that would be harmful to the District's Sewer System, or which,without pretreatment, would violate federal, state or local pretreatment standards. (n) Design and Construction Standards and Specifications for Water and Wastewater Facilities ("Design Standards"): District document that establishes the minimum standards for the design and construction of all Facilities of the District. (o) District: The Resource Colorado Water and Sanitation Metropolitan District, a quasi-municipal corporation and political subdivision of the State of Colorado. •{00096389.DOC v:1} 6 (p) District Engineer: The person or firm appointed by the Board and employed by or contracted with to do engineering work for the District. (q) District Facility or Facilities: All components of the District's Water and Wastewater Systems however acquired by the District and constructed. The District Facilities shall also include all land, easements,permits or other interests in real property, and all operational permits and licenses and all roadways or access facilities and all improvements necessary to the operation of the District Facilities and to carry out the purposes of the District. (r) District Manager: The person or firm retained by the Board to administer and supervise the affairs of the District and its employees, including, but not limited to, enforcement of the District's Rules and Regulations, and who may, among other things, operate,inspect and approve all connections, excavations, extensions, installations, District Facilities owned,to be dedicated to, or under the control of the District. (s) District Water Supply: All non-potable water,potable water, first use or reuse water, return flows, banked water credits, banked return flow credits,tributary, not non-tributary, non-tributary and designated basin water rights and groundwater rights owned by or which is made available by dedication, lease, contract or Agreement to the District for provision of service to Service Providers pursuant to the terms of an Agreement. (t) ERU (Equivalent Residential Unit): An approximate measure of the level of service necessary to serve a single-family dwelling, which is used to calculate the cost of connection fees and service charges pursuant to an Agreement. (u) Extension: A water transmission main or wastewater interceptor sewer required in order for the District to provide service to Service Providers according to the terms and conditions set forth herein. (v) Extension Agreement: An Agreement executed by the District and a Service Provider providing for the installation of an extension by the District pursuant to which the cost of such extension is paid by the Service District to the District. (w) Inspector: The person, persons or firm duly authorized by the Board to inspect,monitor and approve the installation, connection, and operation of the District Facilities and to periodically monitor and inspect the operations of such District Facilities. (x) Industrial User: Any non-domestic source discharging pollutants into the District's Wastewater Facilities. (y) Industrial Wastes: The liquid wastes from industrial processes, trade or business, as distinct from sanitary sewage. (z) Interceptor: Any one of the intercepting sewers,outfalls, or force mains that is part of the Wastewater Collection System. (aa) Interference: A discharge which, alone or in conjunction with a discharge or discharges from other sources,both: {00096389.DOC v:1} 7 1) Inhibits or disrupts the District's treatment processes or operations, or its sludge processes, use or disposal; and 2) Therefore is a cause of a violation of any requirement of the District's NPDES Permit(s) (including an increase in the magnitude or duration of a violation)or of the prevention of sewage sludge use or disposal in compliance with the following statutory provisions and regulations or permits issued thereunder(or more stringent state or local regulations): Article 405 of the Clean Water Act,the Solid Waste Disposal Act (SWDA) (including Title II, more commonly referred to as the Resource Conservation and Recovery Act (RCRA), and including state regulations contained in any state sludge management plan prepared pursuant to Subtitle D of the SWDA),the Clean Air Act,the Toxic Substances Control Act, and the Marine Protection, Research, and Sanctuaries Act. (bb) Main Line: Water or sewer pipe used for the purpose of conveying water to a Water Connection Point or conveying Wastewater from a Wastewater Connection Point that is part of the District Facilities. (cc) Master Water Meter: Measuring device used to determine the amount of water supplied to a Service Provider at a Water Connection Point. (dd) MG: Million gallons. (ee) National Pollutant Discharge Elimination System or NPDES Permit: A permit issued pursuant to Article 402 of the Clean Water Act(33 U.S.C. 1342). (ff) Permit: Written permission of the Board given pursuant to these Rules and Regulations, subject to the specific terms and conditions contained therein. (gg) Person: Any individual, partnership, co-partnership, firm, company, corporation, association,unincorporated association,joint stock company,trust, estate, governmental entity, or any other legal entity, or their legal representatives, agents or assigns, or two or more such persons acting jointly as a firm,partnership, unincorporated association,joint adventurers or otherwise. (hh) pH: The logarithm (base 10)of the reciprocal of the concentration of hydrogen ions expressed in moles per liter of solution. (ii) Pollutant: Any dredged spoil, solid waste, incinerator residue, sewage, garbage, sewage sludge, munitions, chemical wastes, biological materials,radioactive materials,heat,wrecked or discharged equipment, rock, sand, cellar dirt, and industrial, municipal, and agricultural waste discharged into water. (jj) Pollution- Hazard Activity: Means any of the following activities: 1) Drilling operations. 2) Surface and subsurface mining operations. (00096389.DOC v:1) 8 3) The storage and application of pesticides/herbicides and/or insecticides in any manner, except for private residential or business use. 4) The storage and application of fertilizers in any manner, except for private residential or business use. 5) Using, handling, storing, dispensing or transporting toxic or hazardous substances, including, but not limited to radioactive materials. 6) Using, handling, storing, dispensing or transporting flammable or explosive materials, including petroleum products, except for storage of not more than 25 gallons of petroleum products in a private home or business and except for fuel in vehicular fuel tanks. 7) Using, handling, storing, dispensing or transporting organic nutrients, including phosphorus and nitrates, or engaging in any activity that creates the same. 8) Any solid or liquid waste disposal. 9) Any activity that is conducted in a manner that creates a foreseeable risk of pollution to the District Water Supply or damage to the District's Facilities. (kk) Pretreatment or Treatment: The reduction of the amount of Pollutants, the elimination of Pollutants, or the alteration of the nature of Pollutant properties in wastewater to a less harmful state prior to or in lieu of discharging or otherwise introducing such Pollutants into a POTW. The reduction or alteration can be obtained by physical, chemical, or biological processes, or by other means, except as prohibited by 40 CFR §403.6(d). (11) Pretreatment Facilities: Structures, devices, equipment or processes for the purpose of reducing or removing the deleterious wastes from Wastewater or altering the nature of deleterious wastes prior to discharging such sewage into the District's Wastewater Collection System. (nun) Pretreatment Requirement: Any substantive or procedural requirement related to pretreatment, other than a National Pre-treatment Standard imposed on an Industrial User. (nn) Properly Shredded Garbage: Garbage that has been shredded to such a degree that all particles will be carried freely under the flow conditions normally prevailing in public sewers with no particle greater than 1/2" in any dimension. (oo) Property Owner or Owner: The person or persons who hold title to a parcel of land as shown on the property tax assessment roll in the office of the applicable County Assessor. (pp) Publicly Owned Treatment Works ("POTW"): A treatment work as defined by Article 212 of the Clean Water Act(33 U.S.C. §1292), which is owned in this instance by the District. This definition includes any devices and systems used in the storage, {00096389.DOC v.1) 9 treatment,recycling and reclamation of Sewage or industrial wastes of a liquid nature. It also includes sewers,pipes and other conveyances only if they convey wastewater to the POTW treatment plant. "POTW"also refers to the District officials responsible for operations and maintenance of the collection system or treatment plant and the administration of the pretreatment program. (qq) SDWA: The Safe Drinking Water Act of 1974, as amended, 42 U.S.C. §300 j —9(i). (rr) Service Area: A planning term,which refers to all areas currently being served or proposed or planned to be served pursuant to the District's Service Plan approved on August 25, 2004 by the County Commissioners of Weld County, Colorado, as amended from time to time. However, any reference to the District Service Area or proposed Service Area does not mean that the District is capable or that property within the Service Area is entitled to service. (ss) Service Provider(s): Municipalities, counties, authorities, special districts (including Metropolitan Districts and Water and Sanitation Districts),water companies and ditch companies, as well as state and local entities who will contract with the District for water and/or wastewater services and for the provision of wastewater service, and may also include private entities, and who will in turn distribute the water, collect Sewage and otherwise service and bill the individual Customers, including residential, commercial, and/or Industrial Users. (tt) Sewage or Wastewater: A combination of liquid wastes originating from any residential, commercial, or industrial building or other establishment, which may include household wastes, human excreta, animal or vegetable matter, organic or inorganic material in suspension or solution, and other solids in suspension or solution which enter the POTW. (uu) Sewer or Wastewater Main Line: Any pipe, system of piping and appurtenances used as a conduit for Sewage in the District's Wastewater Collection System and owned by the District. (vv) Sewer or Wastewater Service Line: Any pipe, system of piping, tap, line and appurtenances including lift stations,pumping stations and collection lines, used as a conduit for Sewage from the Wastewater Connection Point to the District's POTW. (ww) Significant Industrial User: 1) Any Industrial User subject to categorical pretreatment standards under 40 CFR§403.6 and 40 CFR Chapter 1, Subchapter N; 2) Any Industrial User designated as such by the District on the basis that the Industrial User has a reasonable potential for adversely affecting District operations or for violating any pretreatment standards or requirement; {00096389.DOC v:1} 10 3) Any Industrial User discharging an average 25,000 gallons per day or more of process wastewater to the sanitary sewer system (excluding sanitary,non- contact cooling, and boiler blow down wastewater); and 4) Any Industrial User discharging a process waste stream which makes up five percent(5%) or more of the average dry weather hydraulic or organic capacity of the District's Wastewater Treatment Works. Upon a finding that an Industrial User meeting the criteria in paragraphs (b), (c), or(d) above has no reasonably potential for adversely affecting the District's operation or for violating any Pretreatment Standard or requirement,the District may at any time, on its own initiative or in response to a petition received from a Service Provider or Industrial User, determine that such Industrial User is not a Significant Industrial User. (xx) Slug Discharge: Any discharge of a non-routine, episodic nature, including but not limited to an accidental spill or a non-customary batch discharge. (yy) Suspended Solids: Solids, expressed in parts per million by weight,that either float on the surface of or are in suspension in the water, sewage or other liquids,which are removable by filtration. (zz) Testing: In the context of water or sewage, the analysis of water or sewage samples for composition, and other characteristics; in the context of construction or connection of Water or Wastewater System facilities,the inspection and trial operation of the construction or connection of Water or Wastewater System facilities. (aaa) Total Kjeldahl Nitrogen(TKN): The sum, expressed in parts per million(ppm) or milligrams per liter(mg/L), of free-ammonia nitrogen and organic nitrogen compounds which are converted to ammonia under digestion conditions specified by the Kjeldahl Nitrogen Test Method. (bbb) Toxic Pollutant: But not limited to, any pollutant or combination of pollutants listed as toxic in regulations promulgated by the administrator of the Environmental Protection Agency under the provisions of Article 307(a) of the Clean Water Act or other acts. (ccc) Upset: An exceptional incident in which there is unintentional and temporary noncompliance with permit effluent limitations because of factors beyond the reasonable control of the District which result in flows or solid materials exiting the District's Wastewater System into state waters and which may cause or threaten pollution of state waters. (ddd) Wastewater Collection System: All structures, facilities, and equipment owned and used by the District for collecting, pumping and transporting Wastewater within the District's Wastewater System from the Wastewater Connection Point to the District's Wastewater Treatment Works, including but not limited to metering facilities, Interceptor sewers,manholes and lift stations. {00096389.DOC v:1} 11 (eee) Wastewater Connection Point: The point at which the Service Provider's sewer service lines or system connects to the District's Wastewater System for a permanent or temporary purpose. (fff) Wastewater System: All components of the District's Wastewater Collection System and Wastewater Treatment Works. (ggg) Wastewater Treatment Works: All structures, facilities, and equipment owned and used by the District for treating Wastewater prior to discharge or disposal, including but not limited to the headworks facilities,treatment basins, disinfection processes and effluent outfall, as well as solids handling facilities. (hhh) Water Connection Point: The point at which the Service Provider's water service system connects to the District Water System for a permanent or temporary purpose. (iii) Water Delivery Agreement: A contract for the delivery of all or a portion of the District's Water through the District's Water Distribution System to the Service Provider and may establish other contractual obligations as conditions for the provision of water service to the Service Provider for delivery by the Service Provider to its Customers. (jjj) Water Distribution System: All structures, facilities and equipment owned and used by the District for storing,boosting,transporting to the Water Connection Point, and measuring the District's Water Supply, including but not limited to tanks, booster pump stations, distribution piping and metering facilities. (kk() Water Lease: An agreement with a Service Provider to lease District water or water rights subject to limitations for delivery of water so as not to impair existing Water Delivery Agreements and terms sufficient to secure payment for the Costs of delivering such water. (111) Water Resources Agreement: Agreement between an owner of a water right and a Service Provider seeking to acquire water service from the District,which provides the Service Provider with water resources to serve all or a portion of the property within the Service Provider's service area and may establish other contractual obligations as conditions on the provision of water to the Service Provider by the District, including but not limited to, assurances regarding water quality and availability of substitute supplies. (mmm)Water System: All components of the District's Water Treatment System and Water Distribution System. (nnn) Water Treatment System: All structures, facilities, equipment and processes owned and used by the District for diverting,producing, transporting and treating the District's Water Supply including but not limited to wells, gathering, piping and treatment facilities. {00096389.DOC v:1) 12 Any Other Term: Any other term not herein defined shall be defined as presented in the "Glossary -Water and Sewage Control Engineering,"A.P.H.A., A.W.W.A., A.S.C.E., and F.W.S.A., latest editions. ARTICLE 2. REQUIREMENTS FOR ACQUIRING WATER OR WASTEWATER SERVICE FROM THE DISTRICT 2.1 Water or Wastewater Service.. 2.1.1 Policy.: Provision of water or wastewater service by the District to Service Providers is subject to these Rules and Regulations. Service Providers seeking to acquire water service from the District shall enter into a Water Delivery Agreement with the District whereby the Service Provider's water supply or water resources necessary for meeting the Service Provider's needs shall be made available to the District. For Wastewater Service, Service Providers shall be required to enter into a Connector Agreement. The District may require certain additional conditions prior to granting of service from the District. 2.1.2 No Obligation of Service: Pursuant to C.R.S. §32-1-1001(1)(d)(I),the District may enter into contracts and agreements affecting the District's water or wastewater service and the District's ability to provide such service. The District is not obligated to provide public water or wastewater service other than as required by existing express written Agreements. Subject to the limitations and conditions herein and in any Agreement, it is the intent of the District to make available water or wastewater service to those Service Providers that contract with the District. The relationship between the District and Service Providers receiving water and wastewater service from the District Facilities shall be contractual. 2.1.3 Revocation of Service: Service shall be revocable by the District upon non-payment of fees or charges owed to the District, upon failure to comply with the District's Rules and Regulations, or when the District Manager or Board determines that an emergency exists and such revocation is necessary to protect the health, safety and welfare of the Service Provider Customers. (a) Notice and Hearing: In all cases except as specifically provided otherwise herein, or except in those circumstances involving an imminent hazard to the health, safety or welfare of Service Providers,their Customers or to the District's Water and Wastewater Systems,the District may make provisions for notice and hearing prior to revocation of service. 2.1.4 Covenants: Some conditions of Agreements between the District and Service Providers or other Users seeking service may require Service Providers to enter into commitments concerning real property. Such commitments shall be recorded and shall constitute covenants that run with the property. 2.1.5 Contracts and Agreements: (a) As provided in Article 2.1.2 of this Article 2,the District shall provide water or wastewater service to Service Providers only by Agreement. However, the {00096389.DOC v:l} 13 District may in its discretion determine on a case-by-case basis the appropriate terms of such Agreement(s), including but not limited to the nature of the water to be delivered,terms that meet special circumstances such as bulk delivery agreements, or provisions accommodating special circumstances for wastewater service. (b) Each Agreement is subject to these operating Rules and Regulations, District engineering standards, and all rules and policies promulgated hereunder and amendments thereto. The operating rules and engineering standards and any amendments shall be incorporated by reference and made a part of any Agreements with Service Providers by reference to these Rules and Regulations. 2.1.6 Denial of Service: The District's Board retains, in its sole discretion and judgment,the right to deny an application for service when granting the application for service would not be in the best interests of the District. The District may deny any application for water or wastewater service to any property within the District's Service Area or wastewater service area as defined in Section 6.1.2, based on the District's determination that the District lacks sufficient water treatment capacity, wastewater treatment capacity, water and/or wastewater Facilities and/or water resources to serve the properties proposed by any Service Provider making application to the District for water or wastewater service. Other factors that the District's Board may consider, not by way of limitation, include each of the following: (a) Whether adequate water resources, water rights, water storage and related water facilities are available and will be available in the future to serve existing or proposed Service Providers and the impact of other factors resulting in the unavailability of water supply, including restrictions that may be imposed by the State Engineer or other applicable agency. (b) The impact of the requested service on the District's existing water or wastewater service,treatment, transmission and storage facilities and capacity limitations related to water and wastewater treatment. (c) The economic effect that the approval of the application for service would have on the District. (d) Whether granting the application for service would adversely affect the public health, welfare or safety of the residents and property owners served by the District's existing or future Service Provider customers pursuant to Agreements. (e) Any other factors related to the application for service. There may be factors and aspects of an application for service that are unique to that application and are not contained in the above list, and the Board retains the right to consider any and all factors related to an application for service and to make a decision based thereon. 2.1.7 Application for System Review: A Service Provider seeking to acquire water service from the District shall submit an application for system review, which is the District's review process designed to ensure that the District has adequate resources, to assess District Facility needs, and determine whether Service Provider's water or wastewater facilities proposed to be connected to the District's Water or Wastewater Systems comply with the (00096389.DOC va) 14 District's Design Standards. The District's review will determine the scope of additional District water or wastewater Facilities required to serve the Service Provider. 2.1.8 Other Conditions for Service: In addition to the requirements for service set forth in this Article 2, the District may require that a Service Provider seeking to acquire service from the District satisfy certain conditions, as outlined in this section and as set forth more specifically in other sections of these Rules and Regulations. (a) Integrated System: The District may condition service upon the Service Provider being part of a viable integrated system for the installation, operation and maintenance of water delivery and wastewater systems. The District may adopt operating rules and engineering standards establishing the minimum service requirements,but the District and any Service Providers acknowledge that those requirements may be further limited or restricted by individual Service Provider's rules, regulations or standards. (b) The District may require that all property served or to be served by the District be within the Service Provider boundaries or be included within the Service Provider boundaries or meet other service area requirements for wastewater service as set forth in Article 6 herein, , prior to execution of an Agreement to insure the orderly, efficient, and economically feasible delivery of service. (c) Adequate Water Resources: A Service Provider seeking to acquire water or wastewater service from the District may be required to dedicate reuse or return flow water rights to the District. (d) Adequate Water or Wastewater Systems: The District may require, as a condition of service, advance dedication of fees or capital to build necessary water or wastewater Facilities, and may provide for such fees or capital in an Agreement between the District and the Service Provider, for which the District may, but it is not required to, provide credit to the Service Provider. The District also may require payment of additional fees for the purpose of meeting costs of expanding District Facilities, such fees to be determined by the Board from time to time. (e) Adequate Main Lines and Service Lines: A Service Provider seeking to acquire water or wastewater service from the District shall be required to pay for the District's construction Costs of all Facility extensions necessary to connect the Service Provider's system to the Water and/or Wastewater Systems of the District. (f) Non-Potable Irrigation System: In certain areas of the District a Service Provider seeking to acquire water or wastewater service from the District may be required to pay for the construction of a separate non-potable irrigation system for the Customers of the Service Provider's service area. (g) Well Site Dedication: In order to provide water and/or wastewater service to property within the Service Provider's boundaries or service area, the District may require the dedication of easement(s), easement(s) for well site(s)together with access easement(s),water, sewer and electrical line easement(s) or fee simple property at no cost to the District. The dedication of such easement(s),well site(s) and/or fee simple property shall be in {00096389.DOC v:1) 15 addition to the dedication of water rights that may be required under a Water Delivery Agreement and any other requirements of these Rules and Regulations, and shall be free and clear of all liens and encumbrances prior to approval of service to the Service Provider. (h) Dedication of Groundwater Rights: As a condition of a service, the District may require that the Service Provider dedicate to the District sufficient tributary, not nontributary, nontributary and designated basin water rights and groundwater rights necessary to supply water sufficient to service the Service Provider's Customers. Such dedication shall include the irrevocable consent to the use by the District, as a part of the District Water Supply, of all of the groundwater rights,which use includes without limitation the exclusive right to take, appropriate, produce,use and otherwise dispose of said water. The District has the sole discretion to determine the adequacy and sufficiency of the dedication of such ground water rights, and to determine whether, in the judgment of the District's Board, the groundwater rights are compatible with the District's Facilities and the needs and infrastructure of the Service Provider. The District may further require that the Service Provider consent to being served with such groundwater through the District's Water System,wherein such water may be commingled with the District Water Supply for the purposes of being furnished by the District, and that the Service Provider consent to the continuing jurisdiction of the Water Court or other agency with respect to such water rights, such groundwater rights be conveyed to the District free and clear of all liens and encumbrances prior to approval of service to the Service Provider. (i) Dedication of Water Rights: Sufficient water rights, water storage or related facilities or the equivalent thereof sufficient to provide water service to the Service Provider may be required to be dedicated to the District as a condition of service. The District has sole discretion to determine the adequacy and sufficiency of the dedication of such water rights, water storage or related facilities, and to determine whether, in the judgment of the District's Board,the water rights,water storage or related facilities are compatible with the District's Facilities and the Service Provider's infrastructure and service needs. Such water rights,water storage or related facilities or monies shall be conveyed to the District free and clear of all liens and encumbrances prior to approval of service to the Service Provider. (j) Water Resources Fee: In the sole discretion of the Board, the Service Provider may satisfy all or part of the water resources, groundwater and/or well site dedication requirements stated above through monetary compensation, defined as a water resources fee, adequate to purchase or compensate the District for the water rights, groundwater rights,water storage or related water facilities required to provide such service to the Service Provider. The District may adopt policies from time to time, by Board resolution, regarding such determinations. (k) Reimbursement for Agreement Processing: The District may require in the application process, that on completion of the Board's approval or denial of a proposed Agreement the District may determine the actual cost expended by the District in considering any Agreement and require reimbursement by the Service Provider. 2.1.9 District. Responsibility for Costs of Providing Service within Service Provider's System: A Service Provider seeking to acquire water or wastewater service from the District shall be responsible for the design costs, construction costs, installation costs, and any (00096389.DOC v:1) 16 other costs and/or fees and charges associated with provision of water or wastewater service through the Service Provider's system from the Water or Wastewater Connection Point(s)to the Service Provider's Customers, except as otherwise provided pursuant to separate Agreement with the District. 2.1.10 Procedural Requirements for Acquiring Water or Wastewater Service: (a) Application: A Service Provider seeking service from the District shall submit an application on an approved District form. Any Agreement may contain any conditions, not contrary to law, for the provision of service. (b) Other Procedural Requirements: [Reserved]. 2.2 Fees, Rates and Service Charges. 2.2.1 Policy. Except as provided in any Agreement, all Costs of new construction,reconstruction, repair, replacement or enlargement of the District Facilities which are necessary to provide new, different or additional water or wastewater services within the District's Service Area shall be the responsibility of Service Provider and incorporated into the District's rate structure to insure the sustainability of water quality and quantity and the adequacy of water and wastewater service to Service Providers. Service Providers seeking to acquire water or wastewater service from the District, or seeking changes to existing service, shall have in place a structure for levying and collection of all applicable fees, rates and service charges, which shall be subject to review of the District prior to entering into an Agreement by the District. The provisions of these Rules and Regulations apply regardless of whether the District or some other person contracts for, or initially pays for, such construction, reconstruction or enlargement of the District Facilities. The District Board may act other than as required in this section when it determines, in its sole discretion,that such action is in the best interests of the District, or is necessary to provide for the health, safety and welfare of the inhabitants and visitors of the Service Providers contracting for service with the District. 2.2.2 Payment of Fees: Subject to the terms of individual Agreements with the District, all fees due to the District shall be paid prior to connection to District Facilities and provision of service. 2.2.3 Schedule and Types of Fees,Rates and Service Charges: (a) Schedule of Fees, Rates and Service Charges: The District's fees, rates and service charges shall be as set forth in Exhibit A hereto [Reserved]. (b) System Development Charges: Except as provided in an Agreement, Service Providers shall pay system development charges and/or plant investment fees for service by the District. Such charges and fees shall be for all Costs associated with construction, development,reconstruction or expansion of all District Facilities, including but not limited to diversion structures,wells,pipelines, pumps, lift stations, storage facilities, collection or gathering pipelines, and all water or wastewater treatment facilities, and all other temporary or permanent structures necessary for the development of the District's Water or Wastewater Systems, as applicable, depreciation, and repair and replacement costs and reserves, {00096389.DOC v.1) 17 pursuant to an allocation formula determined by the Board. System development charges or plant investment fees also may include but not be limited to,water resources fees as defined in Section 2.1.8(j), all Costs associated with acquisition of land, water resources, wells or diversion structures, easements,rights of way or permits necessary for the diversion, withdrawal, delivery, treatment, substitution of supply, or storage of the District's Water Supply or provision of water or wastewater service by the District. System development or plant investment fees shall be assessed as provided for in Exhibit A [Reserved]. System development or plant investment fees shall be non-refundable. (c) Connection Fees: Connection fees shall be charged to all Service Providers and shall be due and payable when application is made to the District for new or additional water or wastewater service and prior to the installation of a water or wastewater connection or as otherwise provided in an Agreement. Connection fees can be prepaid. Connection fees shall be calculated to recover all District expenses and costs associated with providing water or wastewater service to a Service Provider or other User as defined in Section 8.16(a). Connection fees may consist of different components such as: connection charge, development plan review fee, water resource development charge, and Master Meter charge. Water and wastewater connection fees shall be assessed as provided for in Exhibit A [Reserved]. Connection fees shall be non-refundable. (d) Service Charges: 1) Policy for Calculation and Payment of Service Charges: Customers' service charges shall be paid by all Service Providers based on rates and charges set by the District pursuant to rate studies and after public hearing. Rates and procedures for payment of service charges to the District shall be as set forth in Agreements or these Rules and Regulations. It shall be the policy of the District to implement procedures for the timely and regular payment of service charges to the District. 2) Amended Service Charges: Agreements shall provide in those situations where, in the Board's sole discretion,the service charges do not represent fair, reasonable and equitable charges for the intended use, the Board may adjust the charges. 3) Payment of Service Charges: Billing cycles for statements for service charges to be paid to the District shall be as determined by the Board or pursuant to an Agreement approved by the Board. Charges for late payments, turn-on, turn-off, or other penalties, shall be added to such statements. Service charges shall be assessed as provided for in Exhibit A [Reserved]. Service charges or fees shall be non-refundable. 2.2.4 Billing Procedures for Service Charges : [Reserved]. {00096389.DOC v:1} 18 ARTICLE 3. WATER SERVICE 3.1 Principles for Supplying Water Resources to Public Water Service Providers. 3.1.1 Policy Regarding Use of District Water System: Use of the District's Water System shall comply with these Rules and Regulations. The right to use the Water System is only by permission granted by the District through a Water Delivery Agreement or other Agreement. The District reserves the right to determine all matters related to the control and use of its Water System. The right to use of the Water System shall be subject to suspension, disconnection or revocation as set forth in these Rules and Regulations or in any Agreement with a Service Provider. 3.1.2 Water Policy: It is the policy of the District to provide Service Providers with single use water unless specified otherwise by Agreement. 3.1.3 Scope of District Water Supply: In order to provide for an integrated Water System as contemplated,the District may acquire water supplies by contractual agreements, purchase contracts, leases or other Agreements. The District Water Supply shall consist of all legally available water, including, but not limited to, supplies of non-potable water, potable water, first use or reuse water,tributary, not non-tributary, non-tributary and designated basin water rights and groundwater rights,return flows,banked return flow credits, or other legally available water supplies together with all well structures, diversion structures, easements, delivery systems, measuring devices and all other appurtenances thereto. All rights to water held, owned or controlled by the District pursuant to any Agreement or conveyance, may be incorporated into the District's Water Supply and shall be available for delivery to Service Providers pursuant to a Water Delivery Agreement. 3.1.4 Ownership of Water and Return Flows: To the extent the District has dominion or control,pursuant to an Agreement or otherwise, of water supplies as part of the District Water Supply, the District shall have sole dominion, control,right and use of all water supplied through the Water System, subject to reasonable use thereof by Service Providers or their Customers in compliance with applicable Water Delivery Agreements and/or these Rules and Regulations. Such dominion and control shall continue without interruption as to all wastewater,return flows, runoff, sewage or tailwater attributable to or originating in water supplied through the Water System,pursuant to any applicable court decrees or regulatory restrictions. The District shall have the exclusive right to recapture such return flows or claim credit therefrom for exchange,replacement, augmentation, substitute supply or any other lawful purpose, and the District's dominion and control over the District's Water Supply shall continue to attach to all such return flows even after they return to the ground. All such return flows from water supplied through the Water System remain the property of the District. The District retains the sole authority to determine the yield of all water, water rights and augmentation plans which are offered to the District for any purpose. 3.1.5 Consent to Groundwater Appropriation: The owners of all land, their heirs, successors and/or assigns which overlies the groundwater comprising all or a portion of the District's Water Supply shall be deemed to have consented to the withdrawal by the District of {00096389.DOC v:1) 19 all such groundwater unless consent shall be deemed to have been withheld as otherwise provided by law upon the effective date of these Rules and Regulations. 3.2 District Water System and Service Provider Systems. 3.2.1 Ownership and Maintenance of Service Provider Water Service Facilities and Lines. (a) Each Service Provider's water service system, commencing from the Connection Point on the District's main water supply line for a Service Provider and continuing through the Service Provider's system, are the property and responsibility of the Service Provider to design, monitor, operate, regulate and maintain as determined by the rules and regulations for the Service Provider. All other water service lines, curb boxes, valve boxes and meter pits, or other improvements necessary for the Service Provider to supply water to its Customers are the property and maintenance responsibility of the Service Provider or Service Provider Customer(s) as determined by the rules and regulations for the Service Provider. (b) Leaks or breaks occurring at Connection Points to the District's Water Distribution System shall be repaired by the Service Provider within seventy-two (72) hours after discovery of such condition by the Service Provider or notification of such condition to the Service Provider by the District. If satisfactory progress toward repairing any leak or break has not been accomplished within such time period, the District shall take actions necessary to make all required repairs at the full expense of the Service Provider. The District reserves the right to make the repair at the expense of the Service Provider when, in the opinion of the District, such repair is necessary to protect the operation of the District's Water System or for the protection of the health, safety and welfare of the inhabitants and visitors of the Service Providers served by the District. 3.2.2 Ownership and Maintenance of Master Water Meters and Related District Facilities: (a) It shall be the duty of all Service Providers to notify the District if a Master Water Meter and/or related facilities at any Connection Point are operating defectively within twenty-four(24)hours of discovery of such condition. It shall also be the duty of all Service Providers to maintain free and clear access to the Master Water Meter and all component parts making up the Master Water Meter assembly. (b) The District shall be responsible for the maintenance and repair of all Master Water Meters unless it determines that said meter has been willfully damaged, in which case the District shall have the Master Water Meter repaired or replaced and shall charge the Service Provider therefore. 3.2.3 Non-Potable Irrigation System: [Reserved]. 3.3 Protection of District Water Supply.Limitations to Protect District Water Supply: In order to protect the District's water supply from pollution and from activities that create a hazard to health and water quality and to protect the health, safety and welfare of the Service Providers and/or their Customers or to District's residents, the District will not provide service to {00096389.DOC v:1) 20 property that is used for a Pollution-Hazard Activity if the location of said property poses an unreasonable risk of contamination that could cause pollution to the District's Water Supply such that the District would not have adequate time following a release of contaminants to protect or provide for a substitute water supply. Such determinations shall be made in the sole discretion of the District. The District shall take all steps necessary in its discretion including contracts with Service Providers to protect the District Water Supply. 3.3.2 Additional Provisions: [Reserved] 3.3.3 Enforcement: [Reserved] 3.3.4 Prohibitions: [Reserved] 3.3.5 Violations: [Reserved] ARTICLE 4. WATER CONSERVATION 4.1 Compliance with State Laws: The District shall implement all measures required by law for water conservation with respect to the operation of the District Water System. 4.2 Development and Implementation of Water Conservation Programs. 4.2.1 Leak Detection: The District's objectives in implementing a leak detection program include assessment of the impact of unaccounted-for water use and Water System loss estimates on the District's Water Supply, and identification and repair of leaks within the Water System to maintain a low and acceptable amount of unaccounted-for water use. The goal is to reduce Water System losses. (a) The District will conduct a water audit to determine the amount of water unaccounted-for or lost in the District Water System. The audit shall include recording information on the Water System, estimating leaks, estimating leak losses, estimating revenue losses from leaks, and estimating costs for repairs. (b) If unaccounted-for water losses from leaks are determined to be ten percent(10%) or more of total consumption,the District shall develop and implement a leak detection program. The program will traverse all of the Water Distribution System that has pipe over twenty(20) years old on a five-year basis to locate and repair leaks. All identified leaks, including leaks in Master Meters and valves, shall be repaired within seventy-two (72) hours. {00096389.DOC v:1} 21 ARTICLE 5. WATER QUALITY 5.1 Monitoring Water Quality. Unless provided otherwise in Water Delivery Agreements or other Agreements, Service Providers shall be solely responsible for meeting all applicable regulations for drinking water or other water quality standards from the Connection Point for delivery through the Service Provider's system to its Customers, including all sampling, monitoring, reporting, notice and compliance standards, regulations and requirements. 5.2 Commingling of Water Supplies. The District may commingle water from its various Water Supply sources provided that delivery requirements are met to Service Providers. 5.2.1 Standards: The District may require that water resources acquired for its Water Supply System meet certain minimum constituent standards for groundwater or other applicable standards and regulations. ARTICLE 6. PROVISIONS FOR WASTEWATER SERVICE 6.1 General. 6.1.1 Policy. Use of and all discharges of wastewater into the District's Wastewater System shall comply with these Rules and Regulations. The right to any use of the Wastewater System is only by permission granted by the District through a Connector Agreement. The District reserves the right to determine all matters related to the control and use of its Wastewater System. The right to use of the District's Wastewater System shall be subject to suspension, disconnection or revocation as set forth in these Rules and Regulations or in a Connector Agreement with a Service Provider. 6.1.2 Service Area: As provided in a Connector Agreement,the form of which is attached hereto as Exhibit B, a Service Provider may only provide wastewater service within its approved service area. The District's wastewater service area is as defined by the local water quality planning agency. This Article describes the procedures for Service Providers requesting approval of an expanded or new wastewater service area. The sewer service area for the District shall only include the area approved by the local water quality planning agency and will only be expanded in accordance with the local water quality planning agency's amendment process. 6.1.3 Request for Approval from an Existing Service Provider: When an existing Service Provider wishes to provide wastewater service to any area outside the service area previously approved by the District, the existing Service Provider shall submit a request in writing to the District . The request shall include, at least, the following: (a) A map of the area showing the boundaries of the enlarged area and showing the existing and the proposed major sewers which will serve the area. The map shall show which existing connection point(s)will serve the additional area and if a new connection point(s) will be required. {00096389.DOC v:I} 22 (b) Information on the projected land use, zoning, residential densities, and commercial/industrial nature of the area. (c) The 10-year, 20-year and ultimate population projections of the enlarged area and the corresponding estimated average and peak quantity of flow expressed in million gallons per day (MGD). The flow data shall be in the form of a flow versus time curve projected to the ultimate development of the area. (d) The 10-year, 20-year and ultimate estimated quality of flow expressed in biochemical oxygen demand(BOD) and suspended solids (SS), plus any additional pertinent information regarding the quality of flow expected,particularly from industrial sources. (e) A letter from all existing sanitation districts or other sewer service entities overlapping or within five miles of the enlarged area stating the feasibility of providing service to the enlarged service area and the justification for not connecting to other existing facilities where feasible. (f) Institutional arrangements such as contracts and/or covenant terms for all users within the expanded service area to insure proper operation and maintenance of the connector's wastewater collection system. (g) Management capabilities, including user contracts, operating agreements,pretreatment requirements, etc., for controlling the wastewater collection system on a continuous long-term basis. 6.1.4 Request for Approval from a New Service Provider: When a new Service Provider wishes to provide wastewater service to any area outside areas previously approved by the District or outside the approved service area of the District,the new Service Provider shall submit a request in writing to the District. The request shall include, at least,the following: (a) A map of the area showing the boundaries of the proposed area and showing the existing and the proposed major sewers which will serve the area. The map shall show which existing connection point(s)will serve the proposed area and if a new connection point(s)will be required. (b) Information on the projected land use, zoning, residential densities, and commercial/industrial nature of the area. (c) The 10-year, 20-year and ultimate population projections of the enlarged area and the corresponding estimated average and peak quantity of flow expressed in million gallons per day (MGD). The flow data shall be in the form of a flow versus time curve projected to the ultimate development of the area. (d) The 10-year, 20-year and ultimate estimated quality of flow expressed in biochemical oxygen demand (BOD) and suspended solids (SS), plus any additional pertinent information regarding the quality of flow expected, particularly from industrial sources. {00096389.DOC v:1} 23 (e) A letter from all existing sanitation districts or other sewer service entities within five miles of the proposed area stating the feasibility of providing service to the proposed service area and the justification for not connecting to other existing facilities where feasible. (f) Institutional arrangements such as contracts and/or covenant terms for all users within the proposed service area to insure proper operation and maintenance of the connector's wastewater collection system. (g) Management capabilities, including user contracts, operating agreements, pretreatment requirements, etc., for controlling the wastewater collection system on a continuous long-term basis. 6.1.5 Service Area Information: The existing or new Service Provider shall supply other information concerning the proposed additional service area when the District determines that the information is necessary to make a proper decision and appropriate application to the local water quality management agency. It is necessary that requests be submitted and approved by the District prior to proceeding with planning and construction of any District Facilities to serve the area. 6.1.6 Approval Procedures: When the service area adjustment requested by an existing or new Service Provider is within the District's approved sewer service area,the Board of Directors shall act on the request. Service Providers are advised that a minimum of thirty (30) days is required for consideration of service area adjustments within the District's approved sewer service area. When the requested service area adjustment includes land which lies partially or completely outside the District's sewer service area,the Board of Directors shall act on the request and, if appropriate,process an Areawide Water Quality Management Plan Amendment application in accordance with the local water quality planning agency's requirements. Service Providers are advised that a minimum of six (6) months is required for consideration of service area adjustments partially or completely outside the District's approved sewer service area. 6.1.7 Post-treatment Waters: All water produced as a result of the treatment of wastewater in the District Wastewater System from whatever source shall be owned by the District and the District shall retail sole dominion, control and right of use of all such post- treatment water, subject to requirements of court decrees, statutory requirements and provisions of any Agreements. 6.1.8 Prohibited Wastes: Discharge of any water or Wastewater into the District's Wastewater System containing substances prohibited by these Rules and Regulations or not meeting the requirements set forth in this Article 6 is prohibited. 6.1.9 General Prohibition: No person shall discharge or cause to be discharged into a public sewer or in the District's Sewer service area, any harmful waters or wastes,whether liquid, solid or gas, capable of causing interference, obstruction or damage to any of the District Facilities or hazards to District personnel. Prohibited sewage shall include such quantity of clear {00096389.DOC v:1) 24 water injected into a public sewer which would interfere with the District's Wastewater treatment process. 6.1.10 Construction Modifications to Limit Harmful Waste: Some Customers or Service Providers may be required to install pretreatment facilities, including, but not limited to grease, sand, and/or oil interceptors into their building construction. As required by the District and set forth in Exhibit C hereto, in order to prevent the discharge of such materials and other prohibited wastes into the District's Wastewater System. 6.1.11 Lateral Size: The District shall require all Service Providers to adopt rules and regulations for the design,planning, locating, sizing, and construction of all service laterals and installation thereof, including change orders, in accordance with District standards and requirements set forth in Exhibit D [Reserved]. All costs and expenses of the Customer or Service Provider incurred for the installation and connection of service laterals to the District's Wastewater System shall be the responsibility of the Service Provider. The Service Provider shall be liable to the District for any loss or damage which may directly or indirectly occur by the installation of a service lateral. The Service Provider shall notify the District of any such damage immediately and shall repair such damage within seventy-two (72) hours. If such repairs are not made within such time,the District shall make such repairs and bill the Service Provider therefore. The Service Provider shall reimburse the District for such repairs within thirty(30) days of the date of occurrence. 6.1.12 Maintenance of Laterals: The District shall require Service Providers to adopt rules and regulations providing that Customers shall be responsible for all maintenance, including routine maintenance or maintenance resulting from damage, repair and replacement of the service lateral from the point of connection from the Service Provider's sewer main. The Service Provider or Customer, as determined by the Service Providers' rules and regulations, is responsible for maintenance of the service laterals from the Customer's point of use to the Wastewater Connection Point. The Wastewater Connection Point shall be determined by the District pursuant to a Connector Agreement between the District and the Service Provider. Maintenance of the service laterals shall include all administrative, monitoring, servicing, repair of all damage whether from abnormal use or not, routine repair or maintenance, and replacements costs. ARTICLE 7. LIMITATIONS ON DISCHARGE 7.1 Limitations On Discharged Wastes/Prohibited Wastes. 7.1.1 Standards for Water or Wastewater Discharge into the District's Wastewater System: Service Providers shall comply with all applicable Pretreatment Standards and Requirements. No Service Provider or Customer shall discharge or cause to be discharged into the District's Wastewater System any storm water, surface water, ground water, roof runoff, subsurface drainage, cooling water, air conditioning wastewater or any other domestic or commercial wastewater that does not meet National Pretreatment Standards. {00096389.DOC v:l} 25 7.1.2 Construction Modifications to Limit the Discharge of Harmful Wastes into the District Facilities, Grease Interceptors/Traps and Sand/Oil Interceptors/Traps: Every Service Provider shall adopt rules and regulations approved by the District sufficient to provide for the proper handling of liquid wastes containing excessive grease, excessive sand or other harmful ingredients, as set forth in Exhibit C hereto. 7.1.3 Review of Plans for the Construction and Installation of Pretreatment Facilities: If any water or wastewater is discharged, or is proposed to be discharged,to the District Facilities(1) from restaurants or other food preparation establishments described above, or(2)that may contain the substances or exceed the limitations for standards for water or wastewater discharged into the District's Wastewater System,the Service Provider shall be responsible for contacting the District regarding planning, review, construction and installation of pretreatment facilities prior to discharging any water or Wastewater into the District's Wastewater System. A process for plan review shall determine the need, method, and size of pretreatment facilities required to pretreat or otherwise control the Wastewater to make it acceptable for discharge into the District Facilities. 7.1.4 Sampling Manholes: The District may require Service Providers to adopt regulations requiring the installation of one or more discreet sampling manholes. All placements of sampling manholes must be approved by the District prior to installation. 7.1.5 Interceptor/Trap Maintenance: (a) Responsibility for Maintenance: Service Provider regulations shall require that it shall be the Customer's responsibility to ensure that grease and sand/oil interceptors/traps are maintained and in proper working order. The interceptors shall be unobstructed and available for periodic maintenance inspections and discharge sampling by the Service Provider and the District. (b) Inspection: Existing interceptor/trap installations shall be inspected by the Service Provider to determine compliance with the District's oil and grease discharge standards. Installations not able to achieve compliance with such standards due to improper design shall be modified or replaced in order to achieve compliance with District Design Standards, including design and sizing criteria as set forth in Exhibit D hereto. (c) Reports: Service Providers shall provide the District with periodic reports of maintenance as requested by the District. 7.1.6 Interceptor/Trap Requirements for Existing Property/District Facilities: Service Provider regulations shall require inspection of existing Customer facilities to determine whether any existing pretreatment facility is deficient in size, or waste emanating from the property,business or industry violates the District's Rules and Regulations and/or may cause harm to the District Facilities, or persons entering said District Facilities to perform maintenance, or to the treatment process and/or environment. The Service Provider shall require the Customer to install suitable pretreatment facilities or take other appropriate remedial measures as directed by the District. {00096389.DOC v:1} 26 7.1.7 Construction Modifications to Limit Harmful Wastes, Wash Racks/Floor Slabs. All wash rack construction or modification plans must be approved by the Service Provider in accordance with District Design Standards set forth in Exhibit D hereto. ARTICLE 8. PRETREATMENT REQUIREMENTS 8.1 General. 8.1.1 Authority: This Article 8 is adopted by the District in accordance with the authority conferred in the Clean Water Act, and any regulations implementing the Clean Water Act, including,but not limited to, 40 CFR 403.8, the Colorado Water Quality Control Act, and any regulations implementing the Colorado Water Quality Control Act, C.R.S. §§25-8-101 et sue., and the Safe Drinking Water Act, and any regulations implementing the SDWA,with all the powers thereof which are specifically granted to the District, or are necessary or incidental to or implied from power specifically granted therein for carrying out the objectives and purposes of the District and this Article 8. The provisions in this Article 8 shall be called the Pretreatment/Industrial Waste Control Program of the District. 8.1.2 Compliance: The Pretreatment/Industrial Waste Control Program of the District is designed to enable the District to comply with all conditions of its National Pollutant Discharge Elimination System(NPDES)Permit, Federal Pretreatment Regulations, and any applicable sludge disposal regulations, and to meet the following objectives: (a) To prevent the introduction of pollutants into the District Facilities which will interfere with the operation of the Water or Wastewater Systems or contaminate the sludge. (b) To prevent the introduction of pollutants into the Water or Wastewater System which will pass through the Wastewater System, inadequately treated, into the receiving waters or the atmosphere. (c) To prevent the introduction of pollutants into the Wastewater System which might constitute a hazard to humans or to animals. (d) To assure the District's ability to recycle and reclaim Wastewater and sludge. (e) To protect human health and welfare,the environment,property and the District's Publicly Owned Treatment Works. (00096389.DOC vi) 27 PART A RULES AND REGULATIONS FOR SERVICE PROVIDER USE OF DISTRICT WASTEWATER SYSTEM 8.2 Applicability. Any Service Provider, the sewage from which directly or indirectly enters the Wastewater System of the District from areas within or without the boundaries or Service Area of the District, shall be subject to the requirements of this Part and shall be bound by these Rules and Regulations as they now exist or may hereafter be amended. All Service Providers with industrial customers are required to design and administer Pretreatment Industrial Waste Control Programs which are in accordance with this Part A of Article 8, and which will enable the District to comply with all pretreatment and effluent limitation conditions of its National Pollutant Discharge Elimination System (NPDES) Permit, Federal Pretreatment Regulations, and applicable sludge disposal regulations. 8.3 Compliance With Requirements. [Reserved] 8.4 Legal Authority Requirements. [Reserved] 8.5 Program Procedure Requirements. 8.5.1 Industrial Waste Survey: Each Service Provider shall formulate and implement procedures for conducting ongoing, comprehensive industrial waste surveys to locate and identify all Significant Industrial Users discharging to the Service Provider's sewer system. The District shall make the final determination as to whether a particular Industrial User is a Significant Industrial User. To this end,the District may require that a Service Provider collect and forward to the District all information necessary to make this determination. 8.6 Extra-Jurisdictional Industrial Users. [Reserved] 8.7 Exemptions. A Service Provider administering a Pretreatment Program, separate from that of the District, which has been approved by the Regional Administrator of EPA or the Director of the Water Quality Control Division of the Colorado Department of Health in accordance with §403.11 of the Federal Pretreatment Regulations, may be exempted from compliance with certain provisions of this Article 8, as determined by the District. {00096389.DOC v:1) 28 8.8 Program Review. [Reserved] 8.9 Remedies. 8.9.1 Emergency Remedies: Where a discharge to the Wastewater System reasonably appears to present an imminent endangerment to the health or welfare of persons, or presents or may present an endangerment to the environment, or threatens to interfere with the operation of the District, the District shall immediately initiate investigative procedures to identify the source of the discharge, and take any steps necessary to halt or prevent the discharge. If necessary, the District shall seek injunctive relief against the violating Service Provider and any User contributing significantly to the emergency condition. 8.9.2 Routine Remedies: If the District determines that a Pretreatment/Industrial Waste Control Program as administered by a Service Provider is not in compliance or that the discharge from a Service Provider is not in compliance with District Standards, the District shall issue a notice setting forth the Requirements and Standards not being complied with and directing the Service Provider to attain conformance to these Requirements and Standards within a period of ten(10) days. If after ten(10) days, the Service Provider has failed or refuses to comply with this notice, the District may issue an additional notice setting forth remedial actions to be taken by the violating Service Provider and a time schedule for attaining compliance with all Pretreatment/Industrial Waste Control Requirements and Standards. If after thirty(30) days notice, the violating Service Provider has not taken necessary steps to correct the violation, the District may assume in whole or in part Pretreatment/Industrial Waste Control Program responsibilities in lieu of the violating Service Provider. The District may continue in this capacity until the violating Service Provider agrees to the original terms of the notice and any additional terms which the District feels are necessary to ensure ongoing compliance by the Service Provider with all Pretreatment/Industrial Waste Control Requirements and Standards. The Service Provider shall be liable for all costs associated with the District's assumption of responsibilities on behalf of the Service Provider and the District may recover such costs in any manner permitted by law. 8.10 Program Preemption. [Reserved] 8.11 Program Delegation. [Reserved] 8.12 District Monitoring. For the purpose of determining the quantity, quality, and other characteristics of any sewage which shall be or may be delivered and discharged into the Wastewater System by a Service Provider, or into the system of a Service Provider by any User,the District shall have the {00096389.DOC v:I} 29 right at all reasonable times to enter upon and to inspect the Service Provider's system or any industrial or commercial installations connected thereto or any other connections which contribute sewage or Wastewater to the Service Provider's system and to inspect and copy records, to take samples and to make tests, measurements, and analyses of sewage or other wastes in, entering, or to be discharged into such Service Provider's system. 8.13 General Requirements Regarding Deleterious Wastes. None of the following described sewage, water, substances, materials or waste shall be discharged into the District's Wastewater System; and each governing body of each Service Provider shall prohibit and shall prevent any discharges from any outlet into its sewer system, if such discharges cause or significantly contribute to a violation of any of the requirements contained herein: (a) Sewage of such a nature and delivered at such a rate as to impair the hydraulic capacity of the District's Wastewater System, normal and reasonable wear and usage excepted. (b) Sewage of such a quantity, quality, or other nature as to impair the strength or the durability of the sewer structures, equipment or treatment works, either by chemical or by mechanical action. (c) Sewage having a flash point lower than 187°F, as determined by the test methods specified in 40 CFR §261.21. (d) Any radioactive substance, the discharge of which, does not comply with Article RH 4.18 of the Colorado Rules and Regulations pertaining to Radiation Control (Volume 6 of the Code of Colorado Regulations, 6 CCR 1007-1, Part 4, et seq.). (e) Any garbage other than that received directly into the Service Provider's sewer system from domestic and commercial garbage grinders in dwellings, restaurants, hotels, stores, and institutions,by which such garbage has been shredded to such a degree that all particles will be carried freely under flow conditions normally prevailing in public sewers with no particle greater than one-half(1/2) inch in any dimension. (f) Any night soil or septic tank pumpage, except by permit in writing from the District at such points and under such conditions as the District may stipulate in each permit. (g) Sludge or other material from sewage or industrial waste treatment plants or from water treatment plants, except such sludge or other material, the discharge of which to the District Wastewater System shall be governed by the provisions of these Rules and Regulations or any Connector Agreement or as otherwise authorized by the District. (h) Water which has been used for cooling or heat transfer purposes without recirculation, discharged from any system of condensation, air conditioning, refrigeration, or similar use. {00096389.DOC v:1} 30 (i) Water accumulated in excavations or accumulated as the result of grading, water taken from the ground by well points, or any other drainage associated with construction. (j) Any water or wastes containing grease or oil and other substances that will solidify or become discernibly viscous at temperatures between 32°F and 150°F except by permit in writing from the District at such points and under such conditions as the District may stipulate in each permit. (k) Any wastes that contain a corrosive, noxious, or malodorous material or substance which, either singly or by reaction with other wastes, is capable of causing damage to the District's Wastewater System or to any part thereof, of creating a public nuisance or hazard, or of preventing entry into the sewers for maintenance and repair. (1) Any wastes that contain concentrated dye wastes or other wastes that are either highly colored or could become highly colored by reacting with any other wastes, except by permission of the District. (m) Any wastes which are unusual in composition; i.e., contain an extremely large amount of suspended solids or BOD; are high in dissolved solids such as sodium chloride, calcium chloride, or sodium sulfate; contain substances conducive to creating tastes or odors in drinking water supplies; otherwise make such waters unpalatable even after conventional water purification treatment; or are in any other way extremely unusual unless the District determines that such wastes may be admitted to the District Wastewater System or shall be modified or treated before being so admitted. (n) Any substance which may cause the District's effluent or any other product of the District such as residues, sludges or scums,to be unsuitable for reclamation and reuse or to interfere with the reclamation process. In no case, shall a substance discharged to the Wastewater System cause the District to be in non-compliance with sludge use or disposal criteria, guidelines or regulations developed under Article 405 of the Clean Water Act; any criteria, guidelines, or regulations affecting sludge use or disposal developed pursuant to the Solid Waste Disposal Act, the Clean Air Act,the Toxic Substances Control Act, or State criteria applicable to the sludge management method being used. (o) Any substance which may cause the District to violate its National Pollutant Discharge Elimination System (NPDES) Permit or the receiving water quality standards. (p) Except for existing combined sewer facilities, any storm water, directly or indirectly, from surface drains, ditches, or streams, storm or combined sewers, roof, areaway, sumps and sump pumps, or foundation drains, or from any other means, including subsurface drainage or groundwater. 8.14 Prohibited Discharges. None of the following described sewage,water, substances,materials, or wastes shall be discharged into the District's Wastewater System or into the sewer system of a Service (00096389.DOC v:l) 31 Provider,by any User and each governing body of each Service Provider shall prohibit and shall prevent such discharges by any User, either directly or indirectly, into its sewer system: (a) Any liquids, solids or gases which by reason of their nature or quantity are, or may be, sufficient either alone or by interaction with other substances to cause fire or explosion or be injurious in any other way to the District's Wastewater System, the sewer system of a Service Provider or any of its connectors, or to the operation of the District. At no time shall any reading on an explosion hazard meter, at the point of discharge into the District's Wastewater System or the sewer system of a Service Provider or any of its Customers (or at any point in the Wastewater Systems), or at any monitoring location designated by the District in a wastewater contribution permit, be more than ten percent(10%) of the Lower Explosive Limit (LEL) of the meter. Prohibited materials include, but are not limited to, gasoline, kerosene, naphtha, benzene, toluene, xylene, ethers, alcohols, ketones, aldehydes, peroxides, chlorates, perchlorates,bromates, carbides,hydrides, and sulfides. (b) Any solid or viscous material which could cause an obstruction to flow in the sewers or in any way could interfere with the treatment process, including as examples of such materials but without limiting the generality of the foregoing, significant proportions of ashes,wax, paraffin, cinders, sand, mud, straw, shavings,metal, glass,rags, lint, feathers, tars,plastics,wood and sawdust,paunch manure,hair and fleshings, entrails, lime slurries,beer and distillery slops, grain processing wastes, grinding compounds, acetylene generation sludge, chemical residues, acid residues, food processing bulk solids, snow, ice, and all other solid objects,material, refuse, and debris not normally contained in sanitary sewage. (c) Any Wastewater having a pH less than 5.0 for discharges from Industrial Users into the District's Wastewater System or the sewer system of a Service Provider or that of any of its Customers, or less than 6.0 or greater than 9.0 for other discharges into the District's Wastewater System, or wastewater having any other corrosive property capable of causing damage or hazard to any part of the District's Wastewater System or the sewer system of a Service Provider or any of its Customers, or to personnel. (d) Any wastewater having a temperature which will inhibit biological activity at the District's treatment plant, but in no case wastewater containing heat in such amounts that the temperature at the introduction into the District's, Wastewater Treatment Works exceeds 40°C (104°F). (e) Any pollutants, including oxygen demanding pollutants (BOD, etc.) released at a flow rate and/or pollutant concentration which cause Upset. In no case shall a slug load have a flow rate or contain concentrations or qualifies of pollutants that exceed for any lime period longer than fifteen(15) minutes more than five (5) times the average twenty-four (24)hour concentration, quantities, or flow during normal operation. (f) Any water or wastes containing a toxic substance in sufficient quantity, either singly or by interaction with other substances,to injure or interfere with any sewage treatment process, to constitute a hazard to humans or to animals, or to create any hazard or toxic effect in the waters which receive the treated or untreated sewage. {00096389.DOC v.1} 32 (g) Petroleum oil, nonbiodegradable cutting oil, or products of mineral oil origin, each in amounts that will cause interference or Upset. (h) Pollutants which result in the presence of toxic gases, vapors, or fumes within the system in a quantity that may cause acute worker health and safety problems. (i) Any trucked or hauled pollutants except at discharge points designated by the District. (j) Any water or wastes containing pollutant quantities or concentrations exceeding the limitations in Article 8 of these Rules and Regulations, or the limitations in any applicable Categorical Standards. (k) Any wastewater discharges to the District's Wastewater System, except at locations approved by the District. 8.15 Specific Discharge Limitations—Service Providers. No Service Provider shall discharge to the Wastewater System at any time or over any period of time wastewater containing any of the following materials and substances in excess of the limitations provided herein: Limit mg/L 1. Cyanides (as HCN) 2 2. Oil and Grease (Hexane or approved solvent extractable) 75 3. Phenolic compounds (as Phenol) 10 4. Sulfides (as H2S) 10 (00096389.DOC v:1) 33 PART B RULES AND REGULATIONS FOR USERS 8.16 Applicability. (a) A User is any Person who contributes, causes, or permits the contribution of wastewater into the District's POTW. (b) Pursuant to its Service Plan,the District may provide wastewater service to Users through Service Providers. Any User, the sewage from which directly or indirectly enters the Wastewater System of the District from an area within or without the boundaries of the District, shall be subject to the requirements of this Part and shall be bound by these Rules and Regulations as they now exist or may hereafter be amended. Such Rules and Regulations may be enforced against any User. 8.17 General Discharge Prohibitions. No User shall contribute or cause to be contributed, directly or indirectly, any pollutant or wastewater which will interfere with the operation or performance of the POTW. These general prohibitions apply to all such Users of a POTW whether or not the User is subject to national categorical pretreatment standards or any other national, State, district, or local pretreatment standards or requirements: A User may not discharge any of the sewage, water, substances,materials, or wastes listed in Articles 8.13 or 8.14 of these Rules and Regulations. 8.18 Specific Discharge Limitations—Users. 8.18.1 District Limitations: No User shall discharge into the District Wastewater System or into any sewer system at any time or over any period of time, Wastewater containing any of the following materials and substances in excess of the limitations provided herein. These limitations may also be imposed directly on process wastewaters prior to dilution by domestic and other Wastewaters discharged by the User: Limit mg/L 1. Arsenic 0.33 2. Cadmium 3.4 3. Chromium 3.6 4. Copper 6.1 5. Lead 2.2 6. Mercury 0.13 7. Molybdenum 0.71 8. Nickel 5.6 9. Selenium 0.66 10. Silver 2.9 11. Tetrachloroethene 1.5* 12. Zinc 15.6 {00096389.DOC v:1} 34 * Notwithstanding this numeric limitation, the discharge of dry-cleaning process wastes, including new and used tetrachloroethene (perchloroethylene), still bottom oil, and separator water, is prohibited entirely. Where necessary the District may require that these wastes be physically prevented from discharging into the District's Wastewater System. 8.18.2 National Categorical Pretreatment Standards: Once promulgated, Categorical Standards for a particular industrial subcategory, if more stringent, shall supersede all conflicting discharge limitations contained in this Article 8, Part B, as they apply to that industrial subcategory. 8.18.3 State Requirements: State requirements and limitations on discharges shall apply in any case where they are more stringent than federal requirements and limitations or those contained elsewhere in this Article 8, Part B. 8.18.4 Dilution Prohibited: [Reserved]. 8.19 Insignificant Discharges. Notwithstanding the prohibitions and limitations contained in Articles 8.17 and 8.18.1 of these Rules and Regulations,the District may allow a proposed discharge to the system if the District determines that the quantity and quality of the discharge,both alone and in conjunction with similar discharges which might be affected by this determination,will have no material effect on the District's operations, including the quality of its effluent or sludges. Approval of the District must be received in writing before the discharge may commence, and the discharge must adhere to any terms and conditions of the District's approval. Approval of such a discharge is entirely at the discretion of the District, and shall not constitute approval of any additional or similar discharges. Disapproval of a proposed discharge by the District shall not be subject to the appeal and hearing procedure set forth in these Rules and Regulations. 8.20 Accidental Or Unusual Discharges. An accidental or unusual discharge is a discharge which may disrupt Wastewater System treatment processes or operations, damage Wastewater System facilities, cause an NPDES Permit violation at the District's treatment plant or degrade sludge quality excessively, or which differs significantly in quantity or quality from discharges under normal operations. 8.20.1 Accidental Discharge Protection: Each User shall provide protection from accidental or unusual discharges of prohibited materials or other substances regulated by these Rules and Regulations. Infrastructure necessary to prevent accidental discharge of prohibited materials shall be provided and maintained at the Customer or User's own cost and expense. 8.20.2 Notification Requirements: (a) Telephone Notification. In the case of any accidental or unusual discharge, it is the responsibility of the User to immediately telephone and notify the District and {00096389.DOC v.1) 35 the Service Provider providing sewage services of the incident. The notification shall include the location of discharge,type of waste, concentration and volume, and corrective actions. (b) Written Notice. Within five (5) days following an accidental or unusual discharge,the User shall submit to the District a detailed written report describing the cause of the discharge and the measures to be taken by the User to prevent similar future occurrences. Such notification shall not relieve the User of any expense, loss, damage, or other liability which may be incurred as a result of damage to the POTW, fish kills, or any other damage to person or property;nor shall such notification relieve the User of any fines, civil penalties, or other liability which may be imposed by these Rules and Regulations or other applicable law. (c) Notice To Employees. A notice shall be permanently posted on the User's bulletin board or other prominent place advising employees whom to call in the event of an accidental discharge. Employers shall ensure that all employees who may cause or suffer such an accidental discharge to occur are advised of the emergency notification procedure. 8.20.3 Slug Discharge Plan Requirements: [Reserved] 8.21 8.21 Hazardous Waste Discharge Notification. Industrial Users shall notify the District, the EPA Regional Waste Management Division Director, and the state hazardous waste authorities in writing of any discharge into the POTW of any substance which, if otherwise disposed of, would be considered a hazardous waste under 40 CFR Part 261. The specific information required to be reported and the time frames in which it is to be reported are found at 40 CFR §403.12(p). 8.22 Wastewater Contribution Permits. [Reserved] 8.23 Reporting Requirements For Significant Industrial Users. [Reserved] 8.24 Monitoring District Facilities. The District may require to be provided and operated at the User's own expense, monitoring facilities to allow inspection, sampling, and flow measurement of any discharges as necessary to determine compliance with the provisions of these Rules and Regulations. There shall be ample room in or near such sampling manhole or facility to allow accurate sampling and preparation of samples for analysis. The facility, sampling, and measuring equipment shall be maintained at all times in a safe and proper operating condition at the expense of the User. The sampling and monitoring facilities shall be provided in accordance with the District's requirements and all applicable local construction standards and specifications. {00096389.DOC va} 36 Construction shall be completed within such a lime frame as the District shall specify by written notification. 8.25 Information Submittal, Inspection and Sampling. The District may require any User to submit information as necessary to determine compliance with the requirements of these Rules and Regulations. The District may inspect the facilities of any User to ascertain whether the requirements of these Rules and Regulations are being complied with. Persons or occupants of premises where wastewater is created or discharged shall allow the District or its representatives ready access at all reasonable times to all parts of the premises for the purposes of inspection, sampling,records examination and copying, or in the performance of any of their duties. The District,the Colorado Department of Public Health and Environment, and EPA shall have the right to set up on the User's property such devices as are necessary to conduct sampling, inspection, compliance monitoring and/or metering operations. Where a User has security measures in force which would require proper identification and clearance before entry into the User's premises,the User shall make necessary arrangements with security guards so that upon presentation of suitable identification,personnel from the District, the Colorado Department of Public Health and Environment, and EPA will be permitted to enter, without delay, for the purposes of performing their specific responsibilities. All records relating to compliance with pretreatment standards and requirements shall be made available to officials of the District, the Colorado Department of Health, and EPA upon request. 8.26 Wastewater Treatment. Users shall provide wastewater treatment as required to comply with the requirements of these Rules and Regulations, and shall achieve compliance with all national categorical pretreatment standards within the time limitations as specified by the federal pretreatment regulations. Any facilities required to pretreat wastewater to a level acceptable to the District shall be provided, operated, and maintained at the User's expense. 8.27 Confidential Information. Information and data on a User obtained from reports, questionnaires,permit applications, permits, monitoring programs, and inspections shall be available to the public or other governmental agency without restriction unless the User specifically designates and is able to demonstrate to the satisfaction of the District that the release of such information would divulge sales or marketing data, processes, or methods of production entitled to protection as "Confidential Business Information" of the User. Wastewater constituents and characteristics will not be recognized as confidential information. It shall be the User's obligation to stamp each page, which has been demonstrated to the District's satisfaction to contain trade secrets, with the words "Confidential Business Information,""Confidential Information," or "Confidential." A failure by the User to designate and identify any document in this manner {00096389.DOC v:I) 37 may result in the document losing its protection from disclosure as confidential business information. Confidential business information shall not be made available for inspection by the public but shall be made available upon request to governmental entities or agencies for uses related to these Rules and Regulations and the District's National Pollutant Discharge Elimination System and Colorado Discharge Pollutant System (NPDES/CDPS) Permit. Confidential business information shall not be transmitted to any governmental agency or entity for other uses by the District except upon written request and after a ten(10) day notification and right to object is given to the User. Such notification shall not be required in certain circumstances provided for in 40 CFR Part 2. If after a request for public inspection, a person or entity challenges the determination of any record to protection as confidential business information,the User shall cooperate, to the fullest extent possible and at User's own expense, with the District in the defense of the determination. At the request of the District the user shall, at the User's expense, provide a defense to such challenge. 8.28 Remedies For Noncompliance; Enforcement. 8.28.1 Notice of Violation: Whenever the District determines that any User has violated or is violating any provision of these Rules and Regulations or a Wastewater Contribution Permit issued or approved hereunder, the District may serve upon such User a verbal or written notice stating the nature of the violation(s). Where directed to do so by the notice, a plan for the satisfactory correction of the violation(s) shall be submitted to the District by the User,within a time frame as specified in the notice. 8.28.2 Administrative Orders: Whenever the District determines that any User has violated or is violating any provision of these Rules and Regulations, or any directives, orders, or permits issued or approved hereunder,the District may serve upon such User a written order stating the nature of the violations(s), and requiring that the User correct the violation(s) within a specified period of time; perform such tasks as the District determines are necessary for the User to correct the violations; or perform such tasks and submit such information as is necessary for the District to evaluate the extent of noncompliance or to determine appropriate enforcement actions to be taken. 8.28.3 Compliance Orders; Compliance Schedules: Whenever the District determines that any User has violated or is violating any provision of these Rules and Regulations, or any directives, orders or permits issued or approved hereunder,the District may serve upon the User a written order requiring that the User submit, within a time frame as specified in the notification, a plan(compliance schedule) for the satisfactory correction of such violation(s). The compliance schedule must represent the shortest schedule by which the User will provide additional treatment or perform such other tasks as will enable the User to consistently comply with applicable requirements. The schedule shall contain increments of progress in the form of dates for the commencement and completion of major events leading to compliance (e.g., Hiring an engineer, completing preliminary plans for pretreatment systems, (00096389.DOC v:1) 38 completing final plans, executing contracts for major components, commencing construction, completing construction). In no case shall an increment of progress exceed nine(9)months. Upon approval by the District, the compliance schedule will be issued to the User as an administrative order which contains the approved schedule milestones and any applicable reporting requirements. Issuance of a compliance schedule by the District does not release the User of liability for any violations. Not later than fourteen(14) days following each date in the schedule and the final date for compliance,the User shall submit a progress report to the District including, at a minimum, information on whether or not the User complied with the increment of progress to be met on such date and, if not, the date on which it expects to comply with this increment of progress,the reason(s)for delay, and the steps being taken by the User to return to the schedule established. 8.28.4 Suspension of Service: The District may suspend the wastewater treatment service when such suspension is necessary, in the opinion of the District, in order to stop an actual or threatened discharge which presents or may present an imminent or substantial endangerment to the health or welfare of persons, to the environment, causes pass through or interference or causes the District to violate any condition of its NPDES Permit. Any User notified of a suspension of the wastewater treatment service shall immediately stop or eliminate the discharge. In the event of a failure of the User to comply voluntarily with the suspension order,the District shall take such steps as deemed necessary, including immediate severance of the sewer connection,to prevent or minimize damage to the POTW System or endangerment to any individuals or the environment. The District shall reinstate the wastewater treatment service upon proof of the elimination of the non-complying discharge. A detailed written statement submitted by the User describing the causes of the harmful contribution and the measures taken to prevent any future occurrence shall be submitted to the District within fifteen(15)days of the date of occurrence. 8.28.5 Permit Revocation: [Reserved] 8.28.6 Penalties: Any User who is found to have violated any provision of these Rules and Regulations, or any orders or permits issued or approved hereunder, shall be subject to a penalty not to exceed, except as noted below,ten thousand dollars ($10,000) for such violation. Each day on which a violation occurs or continues shall be deemed a separate and distinct violation. In the case of violations of monthly or other long-term average discharge limitations, penalties may be assessed for each day in the period covered by the violations. In addition to the penalties provided herein, the District may recover reasonable attorney's fees, court costs, court reporter's fees, and other expenses of litigation by appropriate suit at law against the User found to have violated these Rules and Regulations, or the order or permits issued hereunder. Such penalties shall be in addition to any actual damages the District may incur because of such violations. Where a violation is found to have caused Interference or Upset,the maximum penalty of$10,000 per violation as described above may be increased as necessary to allow the {00096389.DOC v:1) 39 District to recover any fines or penalties paid by the District for NPDES Permit violations due to the Interference or Upset. 8.28.7 Legal Action: If any person discharges sewage, industrial wastes or other wastes into the District's wastewater disposal system contrary to the provisions of these Rules and Regulations, or any orders or permits issued hereunder,the District's attorney may commence an action for appropriate legal and/or equitable relief in the District Court of this county. 8.28.8 Appeal and Hearing Procedure: Any User who is aggrieved by any enforcement action taken by the District pursuant to this Article 8.28 may within thirty(30) days of the receipt of notice of the determination, order, or finding being appealed request in writing that the District review the enforcement action. The request(Letter of Appeal) shall state all points of disagreement and objection to the determination, order, or finding. If the District reaffirms the action,the User may appeal this decision and request a hearing. (a) Hearing Request, Deadlines, Procedure and Related Matters [Reserved] 8.29 Charges and Fees. Charges and fees to be assessed against Users will be determined by the District and, where instituted, will be set at a level to allow the District to recover its costs for administering elements of the Pretreatment/Industrial Waste Control Program. Program elements for which charges and fees may be assessed include, but are not limited to, permit applications; monitoring, inspection, and surveillance activities; and general program administration. ARTICLE 9. CROSS-CONNECTION CONTROL AND BACKFLOW CONTROL POLICY AND REGULATIONS 9.1 General. 9.1.1 Policy : It is the intent of the District to protect the District Water System from contamination or pollution by backflow from a Service Provider's or Customer's internal distribution system or private water system, and to provide for the maintenance of a continuing program of cross connection control, which will systematically prevent the contamination or pollution of the District Water System as provided in Exhibit E hereto. 9.1.2 Responsibility: (a) The District may delegate the responsibility for implementing a cross connection control program in accordance with this Article and for enforcement thereof If a backflow prevention device is required at a Connection Point or at the point of connection from any Service Provider's system to any Customer's premises for the protection of the District Water System,District shall give notice in writing to the Customer to install an approved {00096389.DOC v:1) 40 backflow prevention device at each service connection to the premises. The Customer shall install an approved device or devices at the owner's own expense. (b) No provision of this article exempts the Customer from the cross connection control provisions for internal water distribution systems as contained in the Uniform Plumbing Code,which has been adopted by reference in Chapter 30 of this Code. 9.1.3 Service Provider Requirements. Every Service Provider shall adopt policies and regulations for cross-connection control and backflow control sufficient to: (a) To protect the District's Water System and the water systems of Service Providers from the possibility of contamination or pollution by backflow or backsiphonage. (b) To promote the elimination or control of existing cross- connections, actual or potential, between its Customers' potable water system(s) and non-potable water systems,plumbing fixtures and industrial piping systems. (c) To provide for the maintenance of a continuing program of cross- connection and backflow control, which will systematically and effectively prevent the contamination or pollution of any potable water system. ARTICLE 10. MISCELLANEOUS 10.1 Liability: 10.1.1 District Not Liable: No claim for damage shall be made against the District, and the District and its officials and employees shall not be liable by reason of damage resulting from,but not limited to, any of the following: breaking of any water or wastewater service line, supply line, main line,pipe, cock or meter by any employee of the District; failure of the water supply; shutting off or turning on water in the water main lines;the making of connections or extensions; damage caused by water running or escaping from facilities not owned by the District; damage to water heaters,boilers, or other appliances resulting from shutting water off, or from turning it on, or from inadequate, sporadic and excessive pressures; blockage in the system causing the backup of sewage; breakage of main lines by District personnel; interruption of water or wastewater service and the conditions resulting therefrom where said interruption of service is brought about by request of claimant, or by circumstances beyond the District's control; failure of District Facilities or Service Provider or Customer water and/or wastewater facilities to be located where the District's map indicates they should be; the shutting off of a sewer lift station and possible backflow resulting therefrom; failure to obtain access to isolation valves; or for taking certain actions with respect to the water or wastewater Systems of the District deemed necessary by the Board of Directors or its agents. This paragraph shall not relieve the District from liability for negligence of its employees, if such liability would otherwise have existed. The Service Provider is responsible to make these limitations known to their Customers at or before commencement of service. {00096389.DOC v:1} 41 10.1.2 District Not Responsible for Damages: These Rules and Regulations shall not be construed to hold the District in any manner responsible for any damages to persons or property resulting from any inspections as herein authorized or resulting from the issuance or denial of any permit or failure to approve any Agreement as herein provided, or resulting from the institution of court action as allowed by law, or the forbearance by the District to so proceed. 10.1.3 Officials Not Liable: Any District official or employee, charged with the enforcement of these Rules and Regulations, acting in good faith and without malice on behalf of the District in the discharge of his official duties, shall not thereby render himself or herself personally liable for any damages that may accrue to persons or property resulting from any such act or omission committed in the discharge of such duties. Any suit or proceeding instituted against such official or employee, stemming from any act or omission performed by him in the enforcement or attempted enforcement of any provision of these Rules and Regulations, shall be defended by the District until final termination of the proceedings, in such a manner as to be consistent with the District's resolution indemnifying such officials and employees. 10.1.4 Non-Liability for Work of Others: The District does not assume any liability for any work performed by others. No claim shall be made against the District or any of its officers or employees on account of errors of omission or commission made by the District's licensees or independent contractors. 10.1.5 Indemnity: The Service Provider(s) shall indemnify and hold harmless the District from any losses or damages or claims that may directly or indirectly be occasioned by the installation or operation of any of the Service Provider's facilities or that may arise out of or in connection with any claim against the District resulting from the installation or operation of the Service Provider's facilities or those of their customers. These indemnities shall include all costs for repair or replacement of facilities and all attorneys' fees incurred by the District in defending against such claims. 10.1.6 Non-Waiver: The foregoing indemnity provision,nor any provisions of any contract or other service agreement, shall not constitute a waiver by the District of the defense of sovereign immunity or the Colorado Governmental Immunity Act, or any other defenses it may have to an action against the District, its officials or employees, nor a waiver of its insurance coverage. 10.1.7 Notices and Written Submissions: Any notice,written submission, report or other documentation required under these Rules and Regulations or any Agreement shall be provided to the District by first class,United States mail ("Mail") or by facsimile followed by Mail, to the following: Resource Colorado Water and Sanitation Metropolitan District do Special District Management Services 141 Union Blvd., Suite 150 Lakewood, CO 80228 Phone: (303) 987-0835 Fax: (303) 987-2032 (00096389.DOC v:1} 42 With copies to: Gateway American Resources, LLC Consultant to Resource Colorado Water and Sanitation Metropolitan District 4643 S. Ulster Street, Suite 1300 Denver, CO 80237 Attention: Nicole Adams, P.E. Phone: (303) 843-9742 Fax: (303) 843-0143 McGeady Sisneros P.C. 1675 Broadway, Suite 2100 Denver, CO 80202 Attention: MaryAnn McGeady Phone: (303) 592-4380 Fax: (303) 592-4385 ARTICLE 11. PROVISIONS REGARDING MOSQUITO CONTROL SERVICES [RESERVED] ARTICLE 12. PROVISIONS REGARDING STREET IMPROVEMENTS [RESERVED] ARTICLE 13. PROVISIONS REGARDING EMPLOYEE AND PERSONNEL MATTERS [RESERVED] These Rules and Regulations are adopted effective July 18, 2005, as amended April 11, 2007 by the Board of Directors of the Resource Colorado Water and Sanitation Metropolitan District. {00096389.DOC v:1) 43 Exhibit A Schedule of Fees, Rates and Charges [RESERVED] System Development Fees [Reserved] Plant Investment Fees [Reserved] Connection Fees [Reserved] Service Rates and Charges [Reserved] Other Fees and Charges [Reserved] {00096389.DOC v:1} A-1 Exhibit B Connector Agreement for Wastewater Service [RESERVED] {00096389.DOC v:1} B-1 Exhibit C Pretreatment Discharge Standard to Limit the Discharge of Harmful Wastes into the District's Facilities: Grease Interceptors/Traps and Sand/Oil Interceptors/Traps References to customers in this Exhibit C shall mean service users of the District's Wastewater System pursuant to service agreements between the District and Service Providers. Where these provisions reference the District's right to inspect and enforce these Rules and Regulations, approve connections or otherwise inspect customer use of the Wastewater System, such reference shall not be construed to create a right in the District to provide water or wastewater service directly to individual customers or service users. The District's provision of Water and Wastewater Services shall at all times be pursuant to agreements with Service Providers and the District may apply and enforce these Rules and Regulations or cause the Service Provider to take such action on behalf of the District pursuant to these Rules and Regulations. GREASE INTERCEPTORS/TRAPS APPLICATION This Pretreatment Discharge Standard (PDS) for Food Service Operations defines the local limits, grease interceptor design requirements, and management practices for such facilities. Food service operations subject to this standard include, but are not limited to restaurants, commercial kitchens, cafeterias, food processors, grocery store deli and dairies, schools, fraternal organizations, churches, hospitals, daycare centers, or any other facilities which have the capability to engage in food preparation which are also discharging into a sewer connected to a wastewater treatment facility. This PDS applies to food service operations that: 1. utilize kitchen equipment that discharges oil and grease; or 2. discharge non-domestic waste exceeding the following local limits; or 3. are qualified by the Engineer of the Resource Colorado Water & Sanitation Metropolitan District("District")to fall under this category. LOCAL LIMITS Food Service Operations (hereafter known as customers) shall not discharge waste which at the point of discharge into a sewer contains: 1. oil and grease in a concentration that is in excess of 75 milligrams per liter as analyzed in a grab or continuous sample; 2. suspended solids in a concentration that is in excess of 350 milligrams per liter as analyzed in a grab or continuous sample; 3. 5-day biochemical oxygen demand (BOD5) in a concentration that is in excess of 350 milligrams per liter in a grab or continuous sample; 4. prohibited waste, restricted waste, special waste, as defined by local, state or federal regulations; or 5. storm water. {00096389.DOC v:1) C-1 GREASE INTERCEPTORS The oil and grease interceptor design shall adhere to the following requirements established by the District and shall be subject to approval by the District's Engineer. Oil and grease interceptors not able to achieve compliance with the District's standards shall be subject to modification and/or replacement. Grease interceptors are required to be installed and maintained by the customer. Variances Existing businesses not contributing significant quantities of oil and grease wastes to the collection system may apply for a variance to the grease interceptor requirement, subject to approval by the District. The variance shall apply strictly to the named business owner/operator located at the named business address, subject to an initial inspection and approval by the District. Businesses subject to the variance may include, but not limited to, delicatessens, sandwich shops, and pizza take outs, whereas other than the preparation of pre-cooked meals, no cooking would take place. Design and Installation Oil and grease interceptors must be approved by the District prior to installation. This is to ensure that the interceptor meets the District's sizing, design (see the following Detail Drawing PDS001A), and specification requirements as outlined below, as well as any applicable construction standards and plumbing codes. The following information must be submitted to the District's Engineer to obtain approval: • Detailed plans of interceptor and piping • Number and type of fixtures connected • Proposed interceptor location • Proposed interceptor size • Sizing calculations [Remainder of page intentionally left blank] (00096389.DOC v:1) C-2 Sizing Criteria for Food Grade Oil & Grease Interceptors The basic formula is: (turnover rate) x (categorical use factor(CUF))x 2.5 (gal. of water) x (seating capacity). The varying sizing applications have been broken into the following categories: Customer Catcgor)° Sizing Formula Con tit ents RESTAURANT/CAFETERIA 2.0 x 1.0 x 2.5 x Seating 1. Full or limited service with the capability (Equipment: one grill, one to serve or prepare 100 or more meals per fryer, one to three ovens.) day. 2. Plumbing fixtures: one pot sink,one 2 or 3 compartment sink,one hand sink,one mop sink,one floor sink,and one dishwasher. 3. For each food disposal and additional dishwasher that is directed to the Grease Interceptor, there will be a factor of .25 added to the CUF. 4. Equipment: For each additional"wok" stove,deep fryer, and grill,there will be a factor of.50 added to the categorical factor. 5. MINIMUM ACCEPTABLE INTERCEPTOR SIZE IS 750 GALLONS HOSPITALS/SCHOOLS 2.0 x.75 x 2.5 x 1. A value of .25 will be added to the bed/seating Categorical Use Factor for each dishwasher or garbage disposal directed to the Grease Interceptor above the number of one each. 2. A value of .50 will be added to the C.U.F. for each additional deep fryer or grill above the number of one each. 3. MINIMUM ACCEPTABLE INTERCEPTOR SIZE IS 750 GALLONS INSTITUTIONS/CARE 2.0 x 1.0 x 2.5 x bed/seating 1.A value of.25 will be added to the FACILITIES Categorical Use Factor for each dishwasher or garbage disposal directed to the Grease Interceptor above the number of one each. 2. A value of.50 will be added to the C.U.F.for each additional deep fryer or grill above the number of one each. 3. Minimum Acceptable Interceptor Size is 750 Gallons {00096389.DOC v:1) C-3 Customer Category Sizing torn ula Comments DELI STORES (Hours of operation)x 1. For each of the following conditions, a SUPERMARKETS, 4.0 x 10 factor of,0 is to be added to the C.U.F. value BUTCHERS, and of 4.0 when dealing with meat cutting: BAKERIES I. more than one floor drain (with meat cutting 2. complete cooking of meats capabilities) 2. When dealing with retail-type bakeries or supermarkets that have bakery facilities in addition to a deli and/or meat cutting, the bakery shall be sized separately using the same formula as above with the dejection of the .50 adjustment for the cooking of meats. 3. There is an adjustment of an addition of 1.5 to the C.F.U. when dealing with bakeries that are wholesale only, or are of the industrial classification. 4. Minimum Acceptable Interceptor Size is 750 Gallons FOOD COURTS and 1. Each case shall be sized by separating "COMMON"TRAPS each of the potential contributors into its own category then combining the operations for a total trap size. 2. Minimum Acceptable Interceptor Size is 750 Gallons COMMISARIES, 1. These must be sized on an individual basis. COMMERCIAL However,it should be noted that the minimum KITCHENS and acceptable size for a commercial kitchen shall CATERERS be 1500 gallons FOOD 1. Each case shall be evaluated separately. MANUFACTURERS Whenever a manufacturing operation is evaluated,it must be noted that a Control Manhole will be required in most cases in addition to a minimum of 1500 gallon Grease Connections to Grease Interceptors An operator of a food service operation shall have the following fixtures connected to the grease interceptor system: a. sinks used for washing pots,pans, dishes, cutlery and kitchen utensils; b. drains serving self-cleaning exhaust hoods installed over commercial cooking equipment; c. drains serving commercial cooking equipment that discharges oil and grease; d. drains serving any garbage compactor used to compact waste that may contain, or be contaminated with, food waste; or e. other fixtures that discharge wastewater containing oil and grease. The following fixtures shall not be connected to a grease interceptor: a. toilets, urinals, clothing washers and hand sinks; b. roof drains or other storm drains. {000963S9DOC v:1} C-4 1) Detail Drawing PDS001A a) Diagram of an Approved Food Grade Oil & Grease Interceptor >unroLecovm JfW OAFA£WNL \J/ / •• .._yl SMTfN.Y {1,, U WkTERUIVEL OUTLET TO Paz! SEWER HRE`ID® SUPPORT� YRISER [MAO= it I. 1r INTERCEPTOR SPECIFICATIONS 1. Concrete lid and base of interceptor shall be a minimum of 8"thick. Sidewalls shall be a minimum of 5"thick. Baffle wall shall be a minimum of 3"thick. Submit variances to the District for approval. 2. Baffle wall shall extend a minimum of 10"above water level. 3. PVC screw plug clean outs shall be taken to grade and protected by a cast iron lamp hole cover with a locking lid marked "sewer". Lamp hole covers shall be secured in a square concrete pad. The concrete pad shall extend 12"beyond the center of each cleanout and have a depth equal to the lamp hole cover. Concrete pad to be poured at time of final grade. 4. Inlet invert shall be a minimum of 2"higher than outlet invert. 5. Vent may be cast iron or PVC, schedule 40, taken to 6" above roof line or grade depending on location. 6. Interceptor shall be bedded in a minimum of 6"of%"crushed rock. 7. Grease capacity rated for large compartment only. Secondary compartment has volume equal to 1/3 of total capacity. 8. No bolt down covers allowed without permission from the District. 9. Within trap, all pipe and fittings shall be solvent welded schedule 40 PVC min. 3"diameter. 10. Fill with clean water prior to start up of system. 11. Gray water use only; black water shall be carried by separate sewer. 12. A sampling tee shall be located following the outlet of an interceptor prior to discharge of other waste in the customer's collection line. The tee shall be a minimum of four inches (4") in diameter, installed at right angles to and vertically above the flow of the sewer pipe. Location shall be readily and easily accessible at all times (00096389.DOC v:1) C-5 General Specifications For Grease Interceptors PRE-CAST CONCRETE INTERCEPTORS Pre-cast interceptors shall conform to the size, shape, form, and details shown on the plans. Concrete for pre-cast units shall be Class A concrete defined in the following specifications. All units shall be adequate to withstand AASHTO H-2O (44.30% impact, soil weight = 130 pcf, equivalent fluid pressure = 55 pcf) loading and shall be designed in accordance with ACI 301 and ASTM C-858. All structures not specified in the standard detail shall be submitted to the District for approval as a shop drawing at least 3 weeks prior to installation A flexible plastic joint sealing compound shall be used for any tongue and the groove joints to provide a watertight joint. The performing flexible plastic joint sealing compound shall meet Federal Specifications SS-S-210 and AASHTO M198 75 1, Type B. The sealing compound shall show no visible deterioration when immersed separately in a solution of acid, alkalize and saturated hydrogen sulfide for a period of 30 days. The plastic gasket shall be "Ram-Nek" as manufactured by Henry Co. or an approved equal. All piping within these interceptors shall be solvent weld PVC — SCH 40 DWV. Vertical influent and effluent piping shall be secured to the interceptor walls with non-corroding support brackets. Interceptors installed in a parking lot or a roadway shall have manhole rings and covers raised to grade by using pre-cast concrete riser rings that are a minimum of 6"wide. Cast-In-Place Concrete Interceptors: All cast-in-place grease interceptors shall be designed using the same loading criteria as for precast interceptors. Each interceptor shall be designed by a registered Professional Engineer. For each cast-in-place interceptor, there shall be three sets of wet stamped structural plans submitted to the District for approval. MANHOLE RINGS AND COVERS Manhole rings and covers shall be cast iron in accordance with ASTM A-48, Class 35 B. Twenty- four inch diameter assemblies shall be Neenah-1706, or approved equal, style with a combined weight of not less than 400 pounds (approx. distribution: Frame 235 lbs., Lid 165 lbs.) Covers shall be checkered with letters designating"sewer". All bearing surfaces shall be machined. Manhole lids shall be manufactured with a 1" wide elongated oval lifting hole. Manhole lids with more than one lifting hole shall not be accepted. Rim elevation shall be 2" to 4" above grade in open space and shall be 0"to 'A"below grade of any finished surface. LOCATION A grease interceptor must be located in a readily and easily accessible area that will not be blocked by vehicular traffic, structural members, or submerged by storm water. {00096389.DOC v1) C-6 MAINTENANCE The customer shall maintain all grease interceptors installed in connection with the food service operation in accordance with the manufacturer's recommendations for proper function. The grease interceptor must be evacuated entirely when the depth of waste grease in the first pit is 25% of the total depth of the interceptor(e.g. if the operating depth is 30 inches, the interceptor must be pumped when grease layer is 7.5 inches). All grease interceptors must be evacuated at a minimum of every 3 months unless, grease accumulation (25% of depth) requires more frequent evacuation or, subject to approval by the District, it is determined that less frequent pumping is sufficient. Customers shall not dispose of oil or grease from a grease interceptor to a sewer. All cleaning or grease removal shall be accomplished by employing vactor trucks and the contents shall be hauled and disposed of properly and legally off-site and in accordance with all Federal and Local laws and ordinances. Customers must not use or permit the use of chemical agents, enzymes, bacteria, solvents, hot water or other agents to facilitate the passage of oil and grease through a grease interceptor. Use of these products can cause grease to pass through the interceptor and reaccumulate downstream causing costly sewer main blockages. BEST MANAGEMENT PRACTICES Existing sources (entities established prior to the enforcement of this standard) not connected to grease interceptors or those sources connected to in-line interior grease traps, which contribute significant quantities of oil and grease wastes, shall be required to implement Best Management Practices (BMPs). In the event BMPs do not successfully reduce quantities of oil and grease wastes being introduced to the collection system, those sources shall be subject to installation of approved grease interceptors. BMP inspections shall include,however are not limited to, the following: 1. Identification and description of plumbing fixtures 2. Identification of facility grease reduction procedures 3. Identification of facility grease rendering container,where applicable 4. Identification of in-line interior grease trap,where applicable 5. Verification of in-line interior grease trap maintenance records, where applicable 6. Identification of bacterial or enzymatic uses 7. Facility seating capacity 8. Facility hours of operation 9. Facility schedule of routine drain line maintenance OUTDOOR GARBAGE COMPACTORS An owner of an outdoor garbage compactor installation connected to a sewer must install works as necessary to prevent rainwater from entering the drain connected to the sewer. SAMPLING At the request of the District, the customer shall confirm the operation of any grease interceptor via analytical testing. This testing shall be performed by an accredited laboratory, and paid for by the customer. {00096389.DOC v:I) C-7 RECORD KEEPING AND RETENTION Customers must keep a record of all grease interceptor inspection and maintenance activities at the facility where the interceptor is located. Such records shall remain on file for no less than two years and be readily available for inspection by the District. The records shall contain the following: a. the date of inspection or maintenance; b. the maintenance conducted; c. the type and quantity of material removed from the grease interceptor; and d. the location of disposal of the material removed from the grease interceptor. INSPECTIONS The District shall inspect all grease interceptors to ensure compliance with the District's requirements. The inspection frequency shall be, at a minimum, every 6 months, unless the District determines, at its discretion, more or less frequent inspections are required. The inspection criteria shall include,however is not limited to,the following: 1. Location and accessibility 2. Approximate capacity 3. Identification of inlet and outlet compartments,where applicable 4. Identification of inlet and outlet piping systems 5. Identification of bacterial or enzymatic uses 6. Approximate depth of accumulated solids and grease layer 7. Verification of maintenance records The District shall provide written notices to all businesses following inspections. Those businesses determined to be in violation of the District's requirements shall be provided a written notice of non- compliance. Deficiencies found during the inspection shall be corrected by the customer within two weeks of the date of the inspection unless other arrangements are made with the District. Follow-up inspections shall be completed to ensure compliance. Failure to comply may result in fines or may cause the sewer service to the premises in question to be terminated. {00096389.DOC v:1} C-8 SAND/OIL REMOVAL OPERATIONS APPLICATION The following standard for sand/oil removal operations defines the local limits, sand/oil interceptor design requirements, and management requirements for waste discharged from mechanical repair shops, automobile service stations, garden nurseries, warehouses, oil and lube centers, car washes/detail centers, parking garages, machine shops, paint spray booths, and other facilities (where the removal of inert solids and/or mechanical lubricants is a primary or supporting operation) with the potential to discharge into a sewer connected to a wastewater treatment facility. This standard applies to sand/oil removal operations that: 1. utilize hydraulic washing equipment or mechanical lubricants and/or floor drains that collect and discharge inert solids and oils; or 2. discharge non-domestic waste exceeding the following local limits; or 3. are qualified by the District's Engineer to fall under this category. LOCAL LIMITS Sand/Oil removal operations (hereafter known as customers) shall not discharge waste, which at the point of discharge into a sewer, contains: 4. oil and grease in a concentration that is in excess of 75 milligrams per liter as analyzed in a grab or continuous sample; 5. prohibited waste, restricted waste, special waste, as defined by local, state or federal regulations 6. storm water. SAND/OIL INTERCEPTORS Sand/Oil interceptors are required to be installed and maintained by the customer. Sand/oil interceptor design and installation shall conform to the following standards. Sand/oil interceptors not able to achieve compliance with the District's standards shall be subject to modification and/or replacement. Variances Existing businesses not contributing significant quantities of inert solids or oil wastes to the collection system may apply for a variance to the sand/oil interceptor requirement, subject to approval by the District. The variance shall apply strictly to the named business owner/operator located at the named business address, subject to an initial inspection and approval by the District. Design and Installation Sand/oil interceptors must be approved by the District prior to installation. This is to ensure that the interceptor meets the District's sizing, design (see the following Detail Drawing PDS002A), and specification requirements as outlined below, as well as any applicable construction standards and plumbing codes. The following information must be submitted to the District's Engineer to obtain approval: {00096389.DOC v:1} C-9 • Detailed plans of interceptor and piping • Number and type of fixtures connected • Proposed interceptor location • Proposed interceptor size • Sizing calculations Sizing Criteria for Sand/Oil Interceptors The basic formula is: (building surface area in sq. ft.) x (ratio of interceptor capacity (cu.ft.) to building surface area in sq.ft.). Customer Category Sizing Formula Comments Steam Cleaning,Truck Building Area sq.ft.x 1 cu.ft./15 sq ft 1. Minimum sizes is 750 Washes,Heavy Equipment gallons Washes,Garden Nurseries, Automatic Car Washes Manual Car Wash, Building Area sq.ft.x 1 cu.ft./75 sq.ft. 1. Minimum sizes is 750 Automotive Service Garages gallons Machine Shop Building Area sq.ft. x 1 cu.ft./100 sq.ft. 1. Minimum sizes is 750 gallons Paint Spray Booths Building Area sq.ft. x 1 cu.ft./250 sq.ft. 1. Minimum sizes is 750 gallons Printers Building Area sq.ft.x 1 cu.ft/300 sq. ft. I. Minimum sizes is 750 gallons Warehouses, Parking Garage Building Area sq.ft.x 1 cu.ft/2000 sq.ft. 1. Minimum sizes is 750 (where floors are to be gallons washed) Parking Garage (where Building Area sq.ft. x 1 cu.ft/3000 sq.ft. 1. Minimum sizes is 750 tenants cars are to be washed) gallons Parking Garage (no water Building Area sq.ft. x 1 cu.ft/4000 sq.ft. 1. Minimum sizes is 750 outlets except fire sprinklers) gallons Connections to Sand/oil Interceptors Customers shall have the following fixtures connected to the sand/oil interceptor system: f. Floor drains, sinks for washing parts/equipment, drains serving automatic washing equipment or g. Other fixtures that discharge wastewater containing sand and/or oil. The following fixtures shall not be connected to a sand/oil interceptor: a. toilets, urinals, kitchen sinks,hand sinks, dishwashers, clothing washers; b. roof drains or other storm drain. (00096389.DOC v:1) C-10 Detail Drawing PDS002A Diagram of an Approved Sand/Oil/Water Separator VENT MANHOLE I DUAL FACING 24" COVER \ I CLEANOUTS JIM- CAP tit _WATER LEVEL y LET' SANITARY TEE LET TO SEWER-+- SUPPORT BRACKET ao BAFFLE WALL 1. Concrete lid and base of interceptor shall be a min. of 8" thick. Side walls shall be a min. of 5" thick. Baffle wall shall be a min. of 3" thick. Submit variances to the District for approval. 2. Top of baffle wall shall match water level. 3. PVC screw plug clean outs shall be taken to grade and protected by a cast iron lamp hole cover with a locking lid marked "sewer". Lamp hole covers shall be secured in a square concrete pad. The concrete pad shall extend 12" beyond the center of each cleanout and have a depth equal to the lamp hole cover. Concrete pad to be poured at the time of final grade. 4. Inlet invert shall be a min. of 2" higher than the outlet invert. 5. Vent may be cast iron or PVC, Schedule 40, taken to 6" above roof line or grade depending on location. 6. Interceptor shall be bedded in a min. of 6" of 3/4" crushed rock. 7. Secondary compartment has volume equal to 1/3 of total capacity. 8. No bolt down covers allowed without permission of the District. 9. Within separator, all pipe and fittings shall be solvent welded Schedule 40 PVC min. 3" diameter. 10. Walls and bottom reinforced throughout w/2x16 6/10 remesh. 11. Fill and clean water prior to start up of system. 12. Gray water use only; black water shall be carried by separate sewer. 13. A sampling tee shall be located following the outlet of an interceptor prior to discharge of other waste in the customer's collection line. The tee shall be a minimum of 4 inches in diameter, installed at right angles to and vertically above the flow of the sewer pipe. Location shall be readily and easily accessible at all times. {00096389.DOC v:1) C-11 General Specifications For Sand/oil Interceptors PRE-CAST CONCRETE INTERCEPTORS Pre-cast interceptors shall conform to the size, shape, form, and details shown on the plans. Concrete for pre-cast units shall be Class A concrete defined in the following specifications. All units shall be adequate to withstand AASHTO H-2O (44.30% impact, soil weight = 130 pcf, equivalent fluid pressure= 55 pcf) loading and shall be designed in accordance with ACI 301 and ASTM C-858. All structures not specified in the standard detail shall be submitted to THE DISTRICT for approval as a shop drawing at least 3 weeks prior to installation A flexible plastic joint sealing compound shall be used for any tongue and the groove joints to provide a watertight joint. The performing flexible plastic joint sealing compound shall meet Federal Specifications SS-S-210 and AASHTO M198 75 1, Type B. The sealing compound shall show no visible deterioration when immersed separately in a solution of acid, alkalize and saturated hydrogen sulfide for a period of 30 days. The plastic gasket shall be "Ram-Nek" as manufactured by Henry Co. or an approved equal. All piping within these interceptors shall be solvent weld PVC — SCH 40 DWV. Vertical influent and effluent piping shall be secured to the interceptor walls with non-corroding support brackets. Interceptors installed in a parking lot or a roadway shall have manhole rings and covers raised to grade by using pre-cast concrete riser rings that are a minimum of 6" wide. Cast-In-Place Concrete Interceptors: All cast-in-place sand/oil interceptors shall be designed using the same loading criteria as for pre-cast interceptors. Each interceptor shall be designed by a registered Professional Engineer. For each cast-in-place interceptor, there shall be three sets of wet stamped structural plans submitted to the District for approval. MANHOLE RINGS AND COVERS Manhole rings and covers shall be cast iron in accordance with ASTM A-48, Class 35 B. Twenty- four inch diameter assemblies shall be Neenah-1706, or approved equal, style with a combined weight of not less than 400 pounds (approx. distribution: Frame 235 lbs., Lid 165 lbs.) Covers shall be checkered with letters designating "sewer". All bearing surfaces shall be machined. Manhole lids shall be manufactured with a 1" wide elongated oval lifting hole. Manhole lids with more than one lifting hole shall not be accepted. Rim elevation shall be 2"to 4" above grade in open space and shall be 0"to %2" below grade of any finished surface. LOCATION A sand/oil interceptor must be located in a readily and easily accessible area that will not be blocked by vehicular traffic or structural members. {00096389.DOC v:1} C-12 MAINTENANCE The customer shall maintain all sand/oil interceptors in accordance with the manufacturer's recommendations for proper function. Customers must not permit oil to accumulate in excess of the lesser of six inches or 25% of the wetted height of the sand/oil interceptor. Customers must not permit sand to accumulate to a height greater than 12 inches below the inlet sanitary tee discharge point. Customers shall not dispose of sand or oil from a sand/oil interceptor to a sewer. All cleaning or sand/oil removal shall be accomplished by employing vactor trucks and the contents shall be hauled and disposed of properly and legally off-site and in accordance with all Federal and Local laws and ordinances. BEST MANAGEMENT PRACTICES: Existing sources (entities established prior to the enforcement of this standard) not connected to sand/oil interceptors which contribute significant quantities of inert solids and/or oils, shall be required to implement Best Management Practices (BMPs). In the event BMPs do not successfully reduce quantities of inert solid or oil wastes being introduced to the collection system, those sources shall be subject to installation of approved sand/oil interceptors. BMP inspections shall include, however are not limited to,the following: 1. Identification and description of plumbing fixtures 2. Identification of facility process 3. Identification of sand/oil reduction procedures 4. Identification of facility sand and oil rendering containers,where applicable 5. Verification of used oil evacuation records (including date and contracted hauler's name and contact information),where applicable 6. Facility square footage 7. Facility schedule of routine drain line maintenance SAMPLING At the request of the District,the customer shall confine the operation of any sand/oil interceptor via analytical testing. This testing shall be performed by an accredited laboratory, and paid for by the customer. RECORD KEEPING AND RETENTION Customers must keep a record of all sand/oil interceptor inspection and maintenance activities at the facility where the interceptor is located. Such records shall remain on file for no less than two years and be readily available for inspection by the District. The records shall contain the following: a. the date of inspection or maintenance; b. the maintenance conducted; c. the type and quantity of material removed from the sand/oil interceptor; and d. the location of disposal of the material removed from the sand/oil interceptor. {00096389.DOC v: } C-13 INSPECTIONS The District shall inspect all interceptors to ensure compliance with the District's requirements. The inspection frequency shall be, at a minimum, every 6 months, unless the District determines, at its discretion, more or less frequent inspections are required. The inspection criteria shall include, however is not limited to,the following: 8. Location and accessibility 9. Approximate capacity 10. Identification of inlet and outlet compartments,where applicable 11. Identification of inlet and outlet piping systems 12. Approximate depth of accumulated solids and oil layer 13. Verification of maintenance records The District shall provide written notices to all businesses following inspections. Those businesses determined to be in violation of the District's requirements shall be provided a written notice of non- compliance. Deficiencies found during the inspection shall be corrected by the customer within two weeks of the date of the inspection unless other arrangements are made with the District. Follow-up inspections shall be completed to ensure compliance. Failure to comply may result in fines or may cause the sewer service to the premises in question to be terminated. {00096389.DOC v:11 C-14 Exhibit D District Design Standards and Standards and Requirements for Service Providers [Reserved] {00096389.DOC v:1) D-1 Exhibit E Standards for Cross-Connection Control and Backflow Control Policy and Regulations 1. Definitions: When not clearly otherwise indicated by the context,the following words and phrases in this Article have the following meanings. a. Approved: Accepted by the public works department as meeting the applicable specification stated or cited in this article, or as suitable for the proposed use. b. Auxiliary water supply: Any water supply on or available to the premises other than the District approved public potable water supply. These auxiliary waters may include water from another purveyor's public potable water supply or any natural source such as a well, spring, river, stream,pond, lake, etc., or"used waters"or"industrial fluids."These waters may be polluted or contaminated or may be objectionable and constitute an unacceptable water source over which the District does not have sanitary control. c. Backflow: The undesirable reversal of the direction of flow of the water or mixtures of water and other liquid, gases, or other substances into the distribution pipes of the potable water supply from any source or sources caused by backpressure and/or back-siphonage. d. Back-pressure: The backflow of water or other contaminated fluids caused by a pump, elevated tank, boiler or other means that could create pressure within the Customer's or Service Provider's system greater than the District supply pressure. e. Backflow prevention device: Any device, method, or type of construction designed to prevent backflow or back-siphonage into the public water supply by isolating the Customer's or Service Provider's water system from the public water system. f. Air-gap: The unobstructed vertical distance through the free atmosphere between the lowest opening from any pipe or faucet supplying water to a tank,plumbing fixture, or other device and the flood level rim of said vessel. An approved air-gap will be at least double the diameter of the supply pipe, measured vertically, above the top of the rim of the vessel; and, in no case less than one inch. When an air-gap is used at the service connection to prevent the contamination or pollution of the public potable water system, an emergency bypass shall be installed around the air-gap system and an approved reduced pressure principle device will be installed in the bypass system. g. Double check valve assembly: An assembly of two independently operating approved check valves with tightly closing shut-off valves on each side of the check valves, plus properly located test cocks for the testing of each check valve. The entire assembly shall meet the design and performance specifications and approval of a recognized and District- approved testing establishment for backflow prevention devices. To be approved,these devices must be readily accessible for in-line testing and maintenance. h. Reduced pressure principle device: An assembly of two independently operating approved check valves with an automatically operating differential relief valve {00096389.DOC v.I} E-1 between the two check valves,tightly closing shut-off valves on either side of the check valves, plus properly located test cocks, for the testing of the check and relief valves. The entire assembly will meet the design and performance specifications and approval of a recognized and District-approved testing laboratory for backflow prevention assemblies. The device will operate to maintain the pressure in the zone between the two check valves at a level less than the pressure on the public water supply side of the device. At cessation of normal flow,the pressure between the two check valves will be less than the pressure on the public water supply of the device. In case of leakage of either of the check valves,the differential relief valve will operate to maintain the reduced pressure in the zone between the check valves by discharging to the atmosphere. When the inlet pressure is two pounds per square inch or less, the relief valve will open to the atmosphere. To be approved,these devices must be readily accessible for in-line testing and maintenance, and be installed in a location where no part of the device will be submerged. i. Back-siphonage: The backflow of water or other liquids, mixtures or substances into the distribution pipes of a potable water supply system from any source other than its intended source caused by the sudden reduction of pressure in the potable water supply system. j. Certified inspector and tester: Any person who has passed a state approved or sponsored testing and inspection course, and who is listed by the state as a certified inspector/tester. k. Check valve: A self-closing device which is designed to permit the flow of fluids in one direction and to close if there is a reversal of flow. 1. Colorado Department of Health Cross Connection Control Manual: A manual published by the state addressing cross connection control practices, which will be used as a guidance document for the city in implementing a cross connection control program. m. Compliance period: The time between the receipt by the Customer of a notice from the District or designee thereof to install,test, or repair a backflow prevention assembly and the day upon which such installation, testing, or repair shall be completed or ready for inspection by the District or a designee thereof. n. Contamination: Any impairment of the quality of the potable water by pollution from sewage, industrial fluids or waste liquids, compounds or other materials to a degree which creates an actual hazard to the public health through poisoning or through the spread of disease. o. Critical level: The critical level C-L or C/L marking on a backflow prevention device or vacuum breaker which is a point conforming to approved standards and established by the testing laboratory(usually stamped on the device by the manufacturer), which determines the minimum elevation above the flood-level rim of the fixture or receptacle served at which the device may be installed. When a backflow prevention device does not bear a critical level marking,the bottom of the vacuum breaker, combination valve, or the bottom of any such approved device shall constitute the critical level. {00096389.DOC v:1l E-2 p. Cross connection: Any physical arrangement whereby a public water supply is connected, directly or indirectly, with any other water supply system, sewer, drain, conduit,pool, storage reservoir,plumbing fixture, or other device which contains, or may contain, contaminated water, sewage, or other waste or liquid of unknown or unsafe quality which may be capable of imparting contamination to the public water supply as a result of backflow. Bypass arrangements,jumper connections,removable sections, swivel or changeover devices, and other temporary or permanent devices through which, or because of which, backflow could occur are considered to be cross connections. q. Cross connections, controlled: A connection between a potable water system and a nonpotable water system with an approved backflow prevention device properly installed that will continuously afford the protection commensurate with the degree of hazard. r. Flood-level rim: The edge of the receptacle from which water overflows. s. Hazard, degree of: The term derived from an evaluation of the potential risk to public health and the adverse effect of the hazard upon the public potable water system. t. Hazard,health: Any condition, device, or practice in the water supply system and its operation which could create, or in the judgment of the District,may create a danger to the health and the well being of the water consumer. An example of a health hazard is a structural defect, including cross connections, in a water supply system. u. Hazard,plumbing: A plumbing type cross connection in a consumer's potable water system that has not been properly protected by a vacuum breaker, air-gap separation or backflow prevention device. Unprotected plumbing type cross connections are considered to be a health hazard. v. Hazard, pollutional: An actual or potential threat to the physical properties of the water system or to the potability of the public or the consumer's potable water system which would constitute a nuisance or be aesthetically objectionable or could cause damage to the system or its appurtenances, but would not be dangerous to health. w. Hazard, system: An actual or potential threat of severe damage to the physical properties of the public potable water system or the consumer's potable water system or of a pollution or contamination which would have a protracted effect on the quality of the potable water in the system. x. Industrial fluids system: Any system containing a fluid or solution which may be chemically, biologically or otherwise contaminated or polluted in a form or concentration such as would constitute a health, system, pollutional or plumbing hazard if introduced into an approved water supply. This may include, but not be limited to, polluted or contaminated waters; all types of process water and "used waters" originating from the public water system which may have deteriorated in sanitary quality; chemicals in fluid form; cooling tower and/or cooling towers that are chemically or biologically treated or stabilized with toxic substances; contaminated natural waters such as from wells, springs, streams, rivers, lakes, dams,ponds, retention pits, irrigation canals or systems, etc.; oils, gases, glycerin,paraffins, caustic and acid {00096389.DOC v:1} E-3 solutions and other liquid and gaseous fluids used in industrial or other purposes or for fire- fighting purposes. y. Multistory building: Any building having two or more levels, excluding the basement, or over forty feet in height. Single family units are excluded from this definition. z. Nonpotable water: Water that is not safe for human consumption or that is of questionable potability. aa. Pollution: The presence of any foreign substance (organic, inorganic, radiological, or biological) in the water that may degrade the water quality so as to constitute a hazard or impair its usefulness. bb. Potable water: Water free from impurities in amounts sufficient to cause disease or harmful physiological effects. The bacteriological, chemical, and radiological quality shall conform with state drinking water regulations. cc. Submerged inlet: A water pipe or extension thereto from the public water supply terminating in a tank, vessel, fixture or appliance which may contain water of questionable quality,waste or other contaminant and which is unprotected against backflow. dd. Vacuum: Any pressure less than that exerted by the atmosphere. ee. Vacuum breaker: Atmospheric nonpressure type: a vacuum breaker designed so as not to be subjected to static line pressure or installed where it would be under pressure for not more than twelve hours in any twenty-four-hour period. ff. Vacuum breaker: Pressure type: a vacuum breaker designed so as not to be subjected to static line pressure. gg. Water service connection: The terminal end of a Service Provider's service connection from the Service Provider's water system, i.e., at the curb stop shut-off valve, property line, or meter. There will be no unprotected takeoffs from the service line ahead of any meter or backflow prevention device located at the point of delivery to the Service Provider's or Customer's water system. Service connection will also include water service connection from a fire hydrant and all other temporary or emergency water service connections from the public potable water system. 2. Requirements. a. Water Systems of Service Providers: Service Provider water systems consist of the source and distribution facilities of their water system to the point of connection of the Customer's system up to the District's Water System. The source includes all components of the facilities utilized in the production, treatment, storage, and delivery of water to the Service Provider's distribution system. The distribution system includes the network of conduits used for the delivery of water from the source to the Customer's water service connection. {00096389.DOC v:1} E-4 b. Plan approval: Service Providers shall adopt requirements setting forth the following: i. All building plans involving water/waste water service,plumbing plans for additions or alterations to existing plumbing systems, and/or irrigation system installation submitted to a planning or building department and shall be reviewed by the public works department and approved prior to the issuance of a building permit. ii. Submitted plans must show: (1) Water service type, size and location. (2) Meter size and location. (3) Backflow prevention assembly size, type and location. (4) Fire sprinkling systems service line, size and type of backflow prevention assembly. c. Installation: Service Providers shall adopt requirements for installation of backflow prevention devices as follows: i. An approved backflow prevention device will be installed at or near the property line,before the first branch line leading off the service line wherever any of the following conditions exist: (1) In the case of premises having an auxiliary water supply which is not or may not be of safe bacteriological or chemical quality and which is not acceptable as an additional source by the Service Provider, the public water system will be protected against backflow from the premises by installing a backflow prevention device in the service line appropriate to the degree of hazard. (2) In the case of premises in which any industrial fluids or any other objectionable substance is handled in such a fashion as to create an actual or potential hazard to the public water system, the public water system shall be protected against backflow from the premises by installing a backflow prevention device in the service line appropriate to the degree of hazard. This will include the handling of process waters and waters originating from the public water system which have been subject to deterioration in quality. (3) In the case of premises having internal cross connections that cannot be permanently corrected and controlled, or having intricate plumbing and piping arrangements, or where entry to all portions of the premises is not readily accessible for inspection purposes making it impracticable or impossible to ascertain whether or not dangerous cross connections exist,the public water system shall be protected against backflow from the premises by installing a backflow prevention device in the service line. {00096389.DOC v:1} E-5 ii. Backflow prevention devices are to be installed in an accessible location to facilitate inspection,testing and maintenance. Adequate drainage area for the device must be provided for in the event that water is released. iii. All connections to the Service Provider's water system, including all existing connections, shall conform or be brought into conformance with the requirements of this chapter within one year of adoption of this chapter. iv. All backflow prevention assemblies shall be installed downstream of the water meter in accordance with the installation details contained in the manuals referenced in Article v. Before installing a backflow prevention assembly, pipelines shall be thoroughly flushed to remove foreign material. vi. Backflow prevention valves shall not be used as the inlet or outlet valve of the water meter. Test cocks shall not be used as supply connections. vii. In order to ensure that backflow prevention assemblies continue to operate satisfactorily, it will be necessary that they be tested by a Colorado State Certified Cross- Connection Control Technician approved by the Service Provider, at the time of installation, and no less than annually thereafter. Such test shall be conducted in accordance with the Foundation for Cross-Connection Control and Hydraulic Research performance standards and field test procedures as directed by the Colorado Department of Health. The backflow assembly test results, plumbing permit and test permit number shall be supplied to the public works department within ten days of the test. viii. The Service Provider will inspect all containment installations and the District may inspect the same upon request. ix. All costs for design, installation, maintenance, repair and testing shall be borne by the Customer. x. All fire sprinkling lines shall have a minimum protection of an approved double check valve for containment of the system. xi. All glycol (ethylene or propylene) or antifreeze systems shall have an approved reduced pressure principal assembly for containment. xii. Dry fire systems shall have an approved double check valve installed upstream of the air pressure valve. xiii. Backflow prevention assemblies shall be installed and inspected in accordance with the codes in Article_ [Reserved]. xiv. Backflow prevention assembly installations shall be inspected and approved for use by the Service Provider and upon request, the District. Inspections must be scheduled at least twenty-four hours in advance of the desired inspection time. {00096389.DOC v1) E-6 d. Standards: Backflow prevention devices shall adhere to the following standards: i. Any backflow prevention assembly required herein shall be of a model and size approved by the Service Provider. The term approved backflow prevention assembly shall mean an assembly that has been manufactured in full conformance with the standards established by the codes in Article_ [Reserved]. ii. Backflow prevention assemblies currently installed which are not approved shall be replaced with approved assemblies properly installed. iii. Backflow assemblies used on fire lines shall have O.S. and Y. valves listed by Underwriter Laboratories (UL), Factory Manual (FM) and the National Fire Protection Association. iv. Backflow prevention devices currently installed that are not approved shall be replaced with an approved device within one year of adoption of this chapter, unless the device fails an annual operational test. If the device fails any such test, it will be replaced within ten business days with an approved device. v. The following testing laboratory has been qualified by the District to test and certify backflow prevention devices for all Service Providers: [Reserved]. Testing laboratories other than the laboratory listed above will be added to an approved list as they are qualified by the District. 3. Testing Requirements. a. Inspections, testing, and repair.—non-residential connections: It is the responsibility of the Customer to have certified inspections and operational tests made on the backflow prevention device upon installation and at least annually thereafter. The District may require certified inspections at more frequent intervals. These inspections and tests shall be made at the expense of the Customer and will be performed by a certified inspector approved by the Service Provider. A backflow prevention device will be repaired or replaced at the expense of the Customer whenever a device is found to be defective. (00096389.DOC v:1) E-7 i. Annually, it will be the obligation of the Customer/User at any premises where any backflow prevention assemblies are installed to have a certified test made of these assemblies. In those specific instances where the Service Provider deems the hazard to be great enough, it will require certified inspection at more frequent intervals. The cost for any test under this section shall be at the Customer's expense. All tests shall be performed by a certified technician approved by the Service Provider. ii. As necessary, the assembly shall be repaired or replaced at the expense of the Customer/User whenever the assembly or assemblies are found to be defective. Records or copies of same, of all such tests, repairs or replacement shall be kept by the test of the assembly and the Customer/User, and a copy or copies shall be sent to the Service Provider within ten days of the test, as described in Article_ [Reserved]. iii. All testing gauges shall be tested and calibrated for accuracy yearly, or more often in the event of questionable readings. iv. The Service Provider retains the right to test or otherwise check the installation and operation of any containment assembly at any time. v. This section shall also apply to all irrigation services. b. Inspections,testing and repair—residential connections: It is strongly encouraged that all residential water service connections have certified inspections completed annually. All inspections and tests shall be made at the expense of the Customer and will be performed by a certified inspector approved by the Service Provider and reported as described in Article_ [Reserved]. i. All water service connections served by the District or a consecutive water system or water district Service Provider served by the District that have any • type of auxiliary water supply will be tested according to Article_ [Reserved]. ii. In those specific instances where the District deems that a hazard to the District water system exists, it will require a certified inspection to be completed within five working days of written notification. Annual inspections will continue, based on this chapter, until the public works director deems that a hazard no longer exists. c. Right of entry. i. The Service Provider representative and/or designee assigned to inspect premises relative to possible hazards shall carry proper credentials of his or her office and, upon exhibit of which, said representative shall have the right of entry to inspect any and all buildings and premises for cross-connections in the performance of his or her duties. If such entry is refused,the District or Service Provider or the designated authorized representative thereof shall have recourse to every remedy provided by law to secure entry. ii. This right of entry shall be a condition of continuation of water service in order to provide assurance that the health, safety and welfare of the people throughout the District and Service potable water distribution system is maintained. Where building security {00096389.DOC v:1) E-8 is required, the backflow assembly or assemblies should be located in an area not subject to security. Questions regarding proper credentials should be directed to the Service Provider. d. Reporting and record-keeping: The certified inspector will report on a form approved by the Service Provider, the results of inspections, tests, and maintenance to the Service Provider and the property owner. This report will be submitted to the Service Provider within ten days following the completion of the inspection,test, or maintenance of the device. The certified inspector shall also, on a form approved by the Service Provider, attach a card to the backflow prevention device following each inspection,test, or maintenance activity to document and date the activities performed. Records of all inspections, tests, or maintenance activities, including materials and parts changed, shall be kept by the certified inspector, the property owner, and the Service Provider for a period of not less than five years. 4. Enforcement and Fees. a. Compliance. i. Customers shall cooperate in the installation, maintenance, testing or inspection of backflow prevention assemblies. Failure to cooperate shall be grounds for the discontinuance of water service to the premises, or the requirement for air-gap separation from the public potable water system. ii. Service of water to any Customer may be discontinued by the Service Provider if unprotected cross-connections exist on the premises, or if any defect is found in an installed backflow prevention assembly, or if a backflow prevention assembly has been removed or bypassed. Service shall not be restored until such conditions or defects are corrected. iii. Discontinuance of service may be summary, immediate and without written notice whenever, in the judgment of the District administrator or the designated representative thereof,upon the recommendation of the public works director, such action is necessary to protect the purity of the public potable water supply or the safety of the District Water System. b. Violations and penalties. i. Any person who violates any of these Standards shall be punished by a fine of one thousand dollars ($1,000.00). ii. Each such Customer shall be guilty of a separate offense for each and every day during any portion of which any violation is committed, continued or permitted by any such person. iii. The District is authorized to seek recovery of all present and future damages, costs and other relief to which the District is entitled and obtain any available judicial remedies related to maintenance of a cross-connection or any violation of the provisions of this chapter. (00096389.DOC v:1) E-9 Hello